In a case of administrative dispute over the design patent grant and confirmation, the rights or interests which have been obtained before the application date of the patent and are still legally existing when the request for patent invalidation is filed shall constitute the "prior legitimate rights" as specified in paragraph 3 of Article 23 of the Patent Law.
Natural Person X is the patentee of a design patent titled "Beer Can" (hereinafter referred to as "the present patent"), with an application date of May 28, 2018, and a grant announcement date of December 18, 2018. The design prominently features the text "V8" on the can body. Company A is the owner of the registered trademark "V8," which was filed on December 30, 2016, preliminarily approved on July 27, 2018, and officially registered on October 28, 2018. Company A filed a request with the CNIPA to declare the present patent invalid, arguing that it did not comply with Paragraph 3 of Article 23 of the Patent Law. On November 3, 2020, the CNIPA issued a decision on the invalidation request, maintaining the validity of the present patent. Dissatisfied with this decision, Company A filed a lawsuit with the court.
The first-instance court ruled that given Company A only acquired the exclusive right to the registered trademark "V8" from its registration date, which is later than the filing date of the present patent, the trademark did not constitute a registered trademark right obtained prior to the present patent's application date, nor did it constitute a prior right conflicting with the present patent. Accordingly, the court issued an administrative judgment dismissing Company A's claims. Dissatisfied, Company A appealed the judgment. On September 22, 2023, the Supreme People's Court delivered its final judgment: 1) to overturn the first-instance court's administrative judgment; 2) to revoke the CNIPA's aforementioned decision on the invalidation request; and 3) to order the CNIPA to re-examine Company A's invalidation request regarding the present design patent in question.
The court's effective judgment held that the legislative intent of Paragraph 3 of Article 23 of the Patent Law, which states that "any design for which patent may be granted must not conflict with the legitimate right obtained before the date of filing by any other person," is to prevent the implementation of the design patent from conflicting with the prior legitimate rights of others. Any situation where the implementation of the design patent may infringe upon the prior rights of others falls within the regulatory scope of this provision. Hence, when resolving administrative disputes regarding the grant and confirmation of design patents, the term "legitimate rights" in Article 23(3) of the Patent Law should not be narrowly interpreted. Generally, any legally acquired rights or interests existing before the patent application date and valid at the time of requesting patent invalidation should be considered. Trademark rights represent one of the prior legitimate rights referred to in Article 23 of the Patent Law. Trademarks include registered trademarks and unregistered trademarks. Trademark owners legally enjoy exclusive rights to their registered trademarks and also retain legitimate rights and interests in unregistered marks that have formed a corresponding relationship with the trademark owner through use and have been effectively distinguishing the source of goods or services.
In this case, Company A's claimed prior rights included the prior use of the "V8" mark. Dali B Company, Company A's predecessor, had used and promoted the marks "大理啤酒V8”(English translation: Dali Beer V8) and "大理V8 "(English translation: Dali V8) on beer products for 12 years before the application date of the present patent, and obtained relatively high fame and recognition. Consumers strongly associated the said two marks with Dali B Company's "V8" beer, solidifying a specific link between the "V8" mark and Dali B Company. In addition, Natural Person X resided in the primary sales region of the aforementioned beer, and there’s an objective possibility for potential imitation or replication of the previously filed trademark. Consequently, the court determined that the present patent can be deemed as not complying with the provisions of Article 23(3) of the Patent Law, leading to the reversal of the first-instance judgment and a directive to issue a new decision.
(2023) Zui Gao Fa Zhi Xing Zhong No. 42
If you have any question about the protection of intellectual property rights, please feel free to send us emails. For patent-related matters, please send to info@afdip.com. For trademark/litigation/legal matters, please send to info@bhtdlaw.com.
