Guiding Case No. 273

Zhejiang Ji XX Holding Group Co., Ltd., Zhejiang JiXX Automobile

Research Institute Co., Ltd. v. Wei XX Automobile Manufacturing Wenzhou Co., Ltd., etc.

Trade secret infringement dispute case

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Infringement of Trade Secrets/Cessation of Infringement Liability/Non-monetary Payment Obligation/Late Payment Penalty

Key Points

1. If the accused infringer recruits talent from other companies, thereby creating a channel or opportunity to acquire the company’s trade secrets, and produces products related to the company’s trade secrets within a timeframe significantly shorter than that required for independent research and development, it can be presumed that the accused infringer has committed an act of infringing trade secrets, unless the accused infringer provides contrary evidence sufficient to refute this.

2. When a people’s court orders the defendant to cease infringing trade secrets, it may, based on a comprehensive consideration of the nature of the protected rights, the severity of the infringement, and the possibility of continued infringement in the future, specify the specific requirements for the defendant to cease infringement, including: ceasing to use the trade secrets to manufacture or entrust others to manufacture related products; ceasing to sell related products manufactured using the trade secrets; not implementing or otherwise disposing of related patents applied for using illegally obtained trade secrets without permission, including maliciously abandoning patent rights; destroying or transferring to the right holder any carriers containing trade secrets held or controlled by the infringer and relevant entities or personnel under the supervision of the people’s court and in the presence of the right holder; informing the company’s shareholders, senior management, employees who have left the trade secret right holder to work for the infringer and its affiliated companies, personnel involved in related R&D work, and all employees, affiliated companies, and upstream and downstream manufacturers who may have access to the trade secrets in question, in the form of a public announcement or internal notice, and having relevant personnel or entities sign a commitment to protect the trade secrets in question and not infringe.

3. When a people’s court orders the defendant to cease the infringement, it may comprehensively consider factors such as the nature and circumstances of the infringement and the potential damage caused by the delayed performance of the obligation to cease the infringement, and specify the amount of late performance compensation for the defendant’s delayed performance of the obligation to cease the infringement. The relevant calculation standard may be calculated on a daily or monthly basis, on a product quantity basis, or as a one-time fixed amount, depending on the circumstances.

Basic Case Facts

Nearly 40 senior managers and technical personnel from Chengdu GaoXX Automobile Industry Co., Ltd. (hereinafter referred to as Chengdu GaoXX Company), a subsidiary of Zhejiang JiXX Holding Group Co., Ltd. (hereinafter referred to as JiXX Group), left the company in 2016 and went to work for WeiXX Automobile Technology Group Co., Ltd. (hereinafter referred to as WeiXX Group) and its affiliated companies. JiXX Group discovered that WeiXX Group and WeiXX Smart Mobility Technology (Shanghai) Co., Ltd. (hereinafter referred to as WeiXX Smart Mobility Company) used some of the aforementioned former employees as inventors or co-inventors to apply for 12 utility model patents using the new energy vehicle chassis application technology that they had come into contact with and mastered during their work at Chengdu GaoXX Company, as well as the technical information of 12 sets of chassis component drawings and digital model bearings (hereinafter referred to as the trade secrets in question). Furthermore, Wei XX Group, Wei XX Automobile Manufacturing Wenzhou Co., Ltd. (hereinafter referred to as Wei XX Wenzhou Company), Wei XX Smart Mobility Company, and Wei XX New Energy Vehicle Sales (Shanghai) Co., Ltd. (the aforementioned four companies are collectively referred to as Wei XX Group) launched EX series electric vehicles, including Wei XX EX5, EX6, and E5 models, in a short period of time without any technological accumulation or legitimate source of technology. This is suspected of infringing on the automotive chassis technology secrets of Ji XX Group and Zhejiang Ji XX Automobile Research Institute Co., Ltd. (the aforementioned two companies are collectively referred to as Ji XX Group). Ji XX Group filed a lawsuit with the Shanghai Higher People’s Court, requesting that Wei XX Group cease the infringement and compensate it for economic losses and reasonable expenses for safeguarding its rights, totaling RMB 2.1 billion.

Judgment

On September 5, 2022, the Shanghai Higher People’s Court issued Civil Judgment No. （2018）沪民初102号民事判决, finding that Wei XX Wenzhou Company had infringed upon some of the technical secrets of Ji Xx Group’s automotive chassis technology. The court ordered Wei XXWenzhou Company to cease using the five sets of drawings in question until they were publicly known, and ordered it to compensate Ji XX Group for economic losses of 5 million RMB and reasonable expenses for rights protection of 2 million RMB. Both Ji XX Group and Wei XX Wenzhou Company appealed to the Supreme People’s Court. On April 25, 2024, the Supreme People’s Court issued Civil Judgment No. （2023）最高法知民终1590号民事判决: 1. The Shanghai Higher People’s Court’s Civil Judgment No. （2018）沪民初102号民事判决 is hereby revoked. 2. Wei XX Group shall, from the date of service of this judgment, immediately cease disclosing, using, or allowing others to use Ji XX Group’s solution involving the application technology of new energy vehicle chassis, as well as the technical secrets of 12 sets of automotive chassis component drawings and digital models. The specific methods, content, and scope of ceasing the infringement include, but are not limited to: 1. From the date of service of this judgment, unless the consent of the owner of the trade secret in question is obtained, the user shall cease disclosing, using, or allowing others to use the trade secret in question in any way, including ceasing to use the trade secret in question to manufacture or entrust others to manufacture automobile chassis and chassis parts, and ceasing to sell automobile chassis and chassis parts manufactured using the trade secret in question; the period of cessation of infringement shall continue until the date on which the trade secret information in question becomes publicly known; 2. From the date of service of this judgment, unless with the consent of the holder of the trade secrets involved in the case, no one may implement, authorize others to implement, transfer, pledge or otherwise dispose of the 12 utility model patents involved in the case, including before the relevant patent rights registration is legally changed, and no one may maliciously abandon the patent rights by failing to pay the patent annuity on time and in full or failing to actively respond to the patent invalidation declaration request; 3. Within 30 days after the service of this judgment, under the supervision of the People’s Court or in the witness of the holder of the trade secrets in question, all drawings, digital models and other technical data containing the trade secrets in question held or controlled by Wei XX Company and its affiliated companies and all current or former employees, as well as Wei XX EX series electric vehicle chassis and chassis parts suppliers, shall be destroyed or transferred to the holder of the trade secrets in question; 4. Within 15 days of the service of this judgment, the judgment and the requirement to cease infringement contained herein shall be published in the People’s Court Daily and simultaneously notified to the shareholders, directors, supervisors, senior management, all employees, subsidiaries, branches, other related companies with investment relationships, and suppliers of chassis and chassis parts of Wei’s EX series electric vehicles, and the aforementioned notified parties shall be informed that they should actively cooperate in fulfilling this judgment. 5. Within 30 days of the service of this judgment, all employees who have left the rights holder of the trade secrets in question and its affiliated companies, especially Chengdu Gao Company, to work for Wei XX Group and its affiliated companies, as well as all other personnel (including senior managers) of Wei XX Group Company and its affiliated companies who were responsible for or participated in the research and development of Wei XX EX series electric vehicle chassis and chassis components, and suppliers of Wei XX EX series electric vehicle chassis and chassis components, shall be notified in writing (including electronic data). The aforementioned personnel and entities shall be required to sign a commitment to protect trade secrets and not infringe. 6. Within 45 days of the service of this judgment, the newspaper announcements, internal company notices, written notices to relevant personnel and entities, and the signed commitments required in points 4 and 5 above shall be submitted to the Shanghai Higher People’s Court, and copies shall be provided to Ji X Group . III. Within 30 days of the service of this judgment, Wei XX GRoup shall jointly and severally compensate Ji XX Group for economic losses of RMB 637,596,249.6 and reasonable expenses of RMB 5 million incurred in stopping the infringement. IV. The other claims of Ji are dismissed. V. The appeal of Wei, Wenzhou Company, is dismissed. If the monetary obligations are not fulfilled within the period specified in this judgment, the debtor shall pay double the interest on the debt for the period of delay in accordance with Article 264 of the Civil Procedure Law of the People’s Republic of China. If other obligations are not fulfilled within the period specified in this judgment, a penalty for delay shall be paid in accordance with the law (of which, for refusal to fulfill item 1 of item 2 of this judgment, a penalty of RMB 1 million per day shall be imposed; for refusal to fulfill item 2 of this judgment, a penalty of RMB 1 million shall be imposed for each patent; for failure to fulfill any specific obligation in item 3, 4, or 5 of item 2 of this judgment on time, a penalty of RMB 100,000 per day shall be imposed respectively).

Judicial Reasoning

The central issue in this case is whether Wei infringed upon Ji’s trade secrets, and if so, how to determine Wei’s civil liability.

I. Did Wei infringe upon Ji’s trade secrets in question?

In this case, nearly 40 senior managers and technical personnel of Chengdu Gao’s company, including the company’s general manager, project R&D team leader, technical vice president, technical department head, and several employees who had access to or possessed the technical secrets involved in the case and were specifically engaged in the R&D of automotive chassis technology, left the company around July 2016 to join Wei’s company and its affiliated companies, engaging in related work including the R&D of new energy vehicle chassis technology. Wei’s Wenzhou company was established on May 9, 2016, and its first EX5 electric vehicle went on sale in September 2018, achieving mass production and sales of electric vehicles in just over two years. Wei clearly had access to and opportunities to access the technical secrets of Ji’s solution. Furthermore, the 12 utility model patents applied for by Wei partially disclosed the technical secrets carried by Ji’s solution in the drawings and digital models. A comparison of Wei’s EX5 electric vehicle chassis component drawings and digital models with Ji’s 12 sets of drawings and digital models revealed a large amount of identical technical information, including technical information unique to Ji. This is sufficient to prove that Wei used Ji’s technical secrets in the manufacture of its electric vehicle chassis and chassis components.

Several employees of Chengdu Gao’s company who had access to or possessed the trade secrets in question left their original companies in a short period of time and joined Wei’s company and its affiliated companies. The evidence on file has proven that Wei used some of the same trade secrets as Ji, including Ji’s unique trade secrets. Furthermore, Wei produced products related to the trade secrets in question within a timeframe significantly shorter than that required for independent research and development. Therefore, the burden of proof for the trade secret holder regarding infringement can be reduced. Ji is no longer required to bear further burden of proof regarding the infringement of all trade secrets. Instead, based on the above facts and the research and development patterns and production experience in the automotive manufacturing field, it is directly presumed that Wei actually acquired and used all of Ji’s trade secrets in question. If Wei wishes to refute this presumption, it must provide sufficient contrary evidence.

The alleged infringer’s actual use of the trade secrets in question may be either direct use or use after modification, improvement, adjustment, or optimization based on the trade secrets. Regardless of the method, such use constitutes infringement in a legal sense. In this case, Wei’s party modified and improved some technologies based on Ji’s trade secrets, based on factors such as product positioning, cost control, and the special characteristics of its own vehicle models. This does not affect the judgment that the relevant technologies are substantially the same overall, nor does it affect the legal nature of Wei’s actions constituting trade secret infringement. Furthermore, the evidence provided by Wei is insufficient to refute the presumption that it infringed upon all the trade secrets in question. Therefore, it can be determined that all models of Wei’s EX series electric vehicles used the same chassis technology, constituting an infringement of Ji’s trade secrets.

II. What civil liability should Wei bear?

In the act of infringing upon the trade secrets in question, the four companies of Wei XX Group shared a common fault in the act of infringement. Objectively, their actions constituted division of labor and cooperation, thus constituting joint infringement. They should bear joint and several civil liability for compensation for losses and cessation of infringement in accordance with the law.

Regarding compensation for losses, the court of first instance only found that Wei infringed upon Ji’s technical secrets of 5 sets of automotive chassis component drawings and digital models, and failed to ascertain Ji’s actual losses or Wei’s profits from the infringement. Therefore, the court ordered Wei to compensate Ji for economic losses of 5 million yuan and reasonable expenses of 2 million yuan. On the basis of fully finding that Wei infringed upon Ji’s technical secrets of 12 sets of automotive chassis component drawings and digital models, the court of second instance determined Wei’s profits from the infringement by using data such as the sales volume of Wei’s EX series electric vehicles recorded in Wei’s prospectus. The court also applied double punitive damages to the profits generated after April 2019 (the Anti-Unfair Competition Law, amended and implemented on April 23, 2019, stipulates punitive damages). Therefore, the court ordered Wei to compensate Ji for economic losses of 637,596,249.6 RMB and, at its discretion, supported Ji’s reasonable expenses of 5 million yuan in the first and second instance trials.

Regarding the cessation of infringement, to ensure that rights holders can promptly realize their legitimate rights and interests, the People’s Court may, in light of the specific circumstances of each case, specify the exact methods, content, and scope of the cessation of infringement to enhance the enforceability and deterrent effect of the judgment. In this case, given the egregious nature, large scale, and serious consequences of Wei’s infringement, and the possibility of continued infringement and further damage, it is necessary to take practical, effective, and reasonable detailed measures to ensure the comprehensive and effective cessation of Wei’s infringement: On the one hand, based on the overall judgment ordering Wei to immediately cease disclosing, using, or allowing others to use the technical secrets involved in Ji’s solution, further clarify the specific methods, content, and scope of the cessation of infringement; on the other hand, based on a comprehensive consideration of the nature and circumstances of the infringement and the potential damages arising from the breach of the obligation to cease infringement, clarify the calculation standards for late payment penalties for non-monetary obligations under different circumstances to ensure that Wei promptly and comprehensively ceases the infringement, prevents further expansion of the consequences, and urges Wei to promptly fulfill the non-monetary obligations determined by the judgment.

After the judgment was served, Wei actively and voluntarily published a notice in the *People’s Court Daily* ordering Wei to cease infringing on Ji’s trade secrets, and transferred the 12 utility model patents in question to Ji. Ji and Wei twice destroyed the technical disclosure documents and application documents for the 12 utility model patents, as well as the drawings and digital models of the chassis components of Wei’s EX series vehicles, and both parties confirmed that the relevant drawings and materials had been destroyed. Wei fulfilled its obligation to notify its shareholders, directors, supervisors, senior management, all employees, and subsidiaries and branches through WeChat and other means, and served the effective judgment, notice of cessation of infringement, and commitments to protect trade secrets and not infringe on specific individuals, the legal representatives of its invested subsidiaries, and suppliers, and Ji confirmed that Wei had fulfilled its notification obligations. As of mid-August 2024, the non-monetary obligations determined by the effective judgment in this case had been fulfilled. The monetary payment obligations have been addressed in Wei’s bankruptcy reorganization proceedings.

Relevant legal provisions

Article 22, Paragraphs 1 and 3, and Article 39, Paragraphs 1 and 2, Item 1 of the Anti-Unfair Competition Law of the People’s Republic of China (revised in 2025) (This case is governed by Article 17, Paragraphs 1 and 3, and Article 32, Paragraphs 1 and 2, Item 1 of the Anti-Unfair Competition Law of the People’s Republic of China as amended in 2019).

Article 264 of the Civil Procedure Law of the People’s Republic of China (2023 Amendment)

Article 17, Paragraph 1 of the Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Civil Cases Involving Infringement of Trade Secrets (Fa Shi [2020] No. 7)

Article 505 of the Interpretation of the Supreme People’s Court on the Application of the Civil Procedure Law of the People’s Republic of China (Fa Shi [2015] No. 5, amended in 2022)

Guiding Case No. 274

Qingdao QingXX Heavy Industry Co., Ltd. v. Qingdao ChenXX Machinery Equipment Co., Ltd.

Dispute over infringement of utility model patent rights

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Infringement of Utility Model Patent Rights/Offering to Sell/Civil Liability/Damages

Key Points

An infringer who makes an offer for sale without the patentee’s permission shall not only bear civil liability for ceasing the infringement and paying reasonable expenses for protecting the rights, but also civil liability for compensating for losses, which is not contingent on actual sales. Regarding the amount of compensation, when the losses caused to the patentee by the infringing offer for sale, the profits gained by the infringer, and the patent licensing fees are all difficult to determine, the people’s court may reasonably determine the amount within the statutory compensation range, taking into account the fault and circumstances of the infringement.

Basic Case Facts

Qingdao QingXX Heavy Industry Co., Ltd. (hereinafter referred to as Qingmou Heavy Industry) is the patentee of a utility model patent entitled “Vertical Secondary Structural Column Pump” (hereinafter referred to as the patent in question). On September 29, 2018, QingXX Heavy Industry notarized and preserved the webpage of Qingdao ChenXX Machinery Equipment Co., Ltd. (hereinafter referred to as ChenXX Machinery) displaying the vertical secondary structural column pump on a certain online platform store; on October 20, 2019, it again notarized and preserved the webpage of ChenXX Machinery’s website displaying the vertical secondary structural column pump. Subsequently, QingmXX Heavy Industry filed a lawsuit with the court on the grounds that ChenXX Machinery’s acts of manufacturing, offering for sale, and selling the allegedly infringing products infringed the patent right in question, requesting the court to order ChenXX Machinery to cease infringement and compensate for losses. ChenXX Machinery argued that it only engaged in the act of offering for sale, and did not engage in manufacturing or selling, and neither caused economic losses to QingXX Heavy Industry nor obtained any economic benefits through the act of offering for sale; therefore, QingXX Heavy Industry’s claim for damages lacked basis.

The court, after hearing the case, found that the accused infringing product possessed all the technical features of the corresponding claims of the patent in question, and that ChenXX Machinery Company’s act of displaying the accused infringing product on its website and a certain online platform store constituted an act of offering for sale infringing business. QingXX Heavy Industry Company failed to submit evidence regarding ChenXX Machinery Company’s manufacturing and sales activities.

Judgment

On August 19, 2020, the Qingdao Intermediate People’s Court of Shandong Province issued Civil Judgment No. （2019）鲁02知民初169号民: 1. ChenXX Machinery Company shall immediately cease its act of offering to sell products infringing upon the utility model patent right of QingXX Heavy Industry Company’s “Vertical Secondary Structure Column Pump” from the date the judgment takes effect; 2. Chenmou Machinery Company shall compensate QingXXX Heavy Industry Company for economic losses of RMB 30,000 (including reasonable expenses, the same currency below) within 10 days from the date the judgment takes effect; 3. The other claims of QingXX Heavy Industry Company are dismissed. Dissatisfied with the judgment, ChenXX Machinery Company appealed to the Supreme People’s Court. On March 22, 2021, the Supreme People’s Court issued Civil Judgment No. 2020）最高法知民终1658号: The appeal is dismissed, and the original judgment is upheld.

Judicial Reasoning

The central issue in this case is: what tort liability should ChenXX Machinery Company bear for making an infringing offer to sell?

ChenXX Machinery Company displayed the infringing product in question on its online store for sales purposes, constituting an offer to sell. Offering to sell without permission is a form of infringement explicitly prohibited by patent law. It can occur either after or before the product is manufactured; it can occur before or during the sales process. Although the purpose of offering to sell is directed at the sale itself, it is a legally independent form of infringement. Civil liability for this infringement is not contingent on whether a sale actually occurs. This is because once an unauthorized offer to sell occurs, regardless of whether a sale is actually made, it generally results in the loss of related patent licensing fees. Furthermore, the price offered by the accused infringer is usually lower than the price of the patented product, thus creating a psychological suggestion for potential consumers, affecting the reasonable pricing of the patented product, or causing consumers to abandon purchasing the patented product and instead consider contacting the accused infringer, resulting in a delay or even reduction in the normal sales of the patented product. Offering to sell infringing acts may also adversely affect the advertising effect of the patented product. It is evident that offering for sale can cause patent holders to lose licensing fees and may also lead to price erosion of patented products, delays in business opportunities, or even reductions in such opportunities. These damages should be remedied according to law. Therefore, while ordering the infringer to cease infringement, the court should also hold them liable for damages related to the offering for sale. This approach is more conducive to protecting and incentivizing innovation, achieving the legislative purpose of patent law, and creating a favorable business and innovation environment. If, simply because the specific damages caused by the offering for sale are difficult to prove accurately, the infringer is exempted from liability for damages and only required to cease the offering for sale and pay the patent holder’s reasonable expenses for protecting their rights, this would be detrimental to protecting patent rights and achieving the legislative purpose of patent law.

When a patentee struggles to provide evidence of specific losses suffered due to an offer to sell, they can calculate damages through statutory damages. Precisely because of the difficulty in proving patent infringement damages, the Patent Law establishes a statutory damages system. When the losses suffered by the patentee due to infringement or the profits gained by the infringer are difficult to determine, the amount of damages can be determined based on factors such as the type of patent, the nature and circumstances of the infringement. In this case, since QingXX Heavy Industry Company failed to provide evidence of its actual losses, ChenXX Machinery Company’s profits from the infringement, and the licensing fees for the patent in question, the People’s Court, after comprehensively considering factors such as the type of patent in question, ChenXX Machinery Company’s subjective fault, the circumstances of ChenXX Machinery Company’s infringement, and QingXX Heavy Industry Company’s reasonable expenses for protecting its rights, legally determined that ChenXX Machinery Company should compensate QingXX Heavy Industry Company for economic losses of 30,000 RMB.

Relevant legal provisions

Article 11, Paragraph 1 and Article 71 of the Patent Law of the People’s Republic of China (amended in 2020) (Article 11, Paragraph 1 and Article 65 of the Patent Law of the People’s Republic of China (amended in 2008) apply to this case.

Guiding Case No. 275

Jiangsu JinXX Seed Industry Technology Co., Ltd. v. Jiangsu QinXX Agricultural Industry

Dispute over infringement of plant variety rights by a development company

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Infringement of Plant Variety Rights/Sales Conduct/Tortious Acts/Punitive Damages

Key points

If the accused infringer organizes the sale of the accused infringing seeds and actually takes the lead in determining the specific transaction conditions such as transaction price, transaction quantity, and performance time, and thus constitutes the organizer and decision-maker of the transaction, it can be determined that he directly carried out the act of selling the accused infringing seeds.

Basic Case Facts

Jinsheng Seed Industry Technology Co., Ltd. (hereinafter referred to as Jinsheng Seed Industry) alleged that as the exclusive licensee of the new rice variety “Jinjing 818”, Jinsheng Seed Industry was accused of infringing on the plant variety rights of Jiangsu QinXX Agricultural Industry Development Co., Ltd. (hereinafter referred to as QinXX Agricultural Company) by soliciting members and collecting service fees and selling “Jinjing 818” rice seeds in white bags to members by posting “agricultural industry chain information matching” messages in the members’ WeChat groups. Therefore, Jinsheng Seed Industry requested the court to order QinXX Agricultural Company to cease the infringement and to apply punitive damages to order it to compensate for economic losses and reasonable expenses for rights protection totaling RMB 3 million.

Qin, an agricultural company, argued that it did not sell the allegedly infringing “Jinjing 818” rice seeds, but only provided information on its reserved seeds to both the seed suppliers and buyers, who then traded the seeds themselves.

The court found that a certain research institute in Tianjin was the variety rights holder of a new rice variety with variety rights number CNA20******.* and the name “Jinjing 818”. In October 2017, the Tianjin research institute issued a “Letter of Authorization” authorizing Jinjing Seed Industry Company to exclusively implement the variety.

On May 21, 2019, investigators commissioned by Jinshan Seed Industry Company inquired about the price of “Jinjing 818” seeds via WeChat with personnel from QinXX Agricultural Company. QinXX Agricultural Company replied that the white-bag “Jinjing 818” seeds were priced at 2 RMB per jin (approximately 0.5 kg). On May 25, 2019, the investigators contacted QinXX Agricultural Company via WeChat, expressing their desire to sign a contract the following day and inquiring about the delivery time of seeds, including 10,000 jin of “Jinjing 818” seeds. QinXX Agricultural Company personnel immediately promised to fulfill this request. On May 26, 2019, Jinshan Seed Industry Company obtained a notarized copy of the “Joint Farm Franchise Agreement” and a receipt at a seed shop in Suqian City, Jiangsu Province. The agreement listed QinXX Agricultural Company as Party A and the investigators commissioned by Jinshan Seed Industry Company as Party B. The agreement stipulates that Party A will build a comprehensive agricultural industry chain service platform, including centralized procurement of agricultural inputs, base services (plowing, planting, harvesting, spraying, fertilizing, drone plant protection, etc.), credit support (agricultural insurance, agricultural loans), contract farming, grain bank and other one-stop planting services. Currently, it serves more than 2 million mu of cultivated land, radiating to more than 4,600 large-scale farmers in Jiangsu, Shandong, Henan and Anhui provinces, with annual transactions exceeding 200 million RMB. In order to reduce production costs and increase economic benefits, Party B will join QinXX Joint Farm and enjoy zero markup on centralized procurement of agricultural inputs. Party A is essentially Party B’s agricultural input procurement department. Party A will procure high-quality and low-priced agricultural inputs globally and supply them to Party B at the centralized procurement price (ex-factory price). Party A promises to save Party B 30-50 yuan/mu/year on agricultural inputs. Party B has an actual cultivated land area of 470 mu and joins QinXX Joint Farm, enjoying the zero markup centralized procurement service for agricultural inputs, and will bear a service fee of 10 RMB/mu/season (annual service fee of 20 RMB/mu), totaling 4,700 RMB. On the day the agreement was signed, investigators from Jin Seed Industry Company paid Qin Agricultural Company a franchise service fee of 4,700 RMB for one season, and Qin Agricultural Company issued a receipt to the investigators from Jin Seed Industry Company. Qin Agricultural Company acknowledged that the shop recorded in the notarized document was operated by it. On May 28 of the same year, personnel from Qin Agricultural Company confirmed to the investigators from Jin Seed Industry Company that they had contacted the seed source of “Jinjing 818” and provided the mobile phone number of the so-called “supplier,” Zhou. On May 30 of the same year, investigators from Jin Seed Industry Company informed personnel from Qin Agricultural Company via WeChat that they had contacted Zhou, and personnel from Qin Agricultural Company replied to confirm. On June 2 of the same year, Jin Seed Industry Company obtained 10,000 jin of the allegedly infringing seeds through notarization, with delivery and payment collected by a third party, and a receipt was provided. The receipt states, “Jia XXAgriculture delivered 250 bags of rice seeds (Jinjing 818) × 40 = 10,000 jin × 2 = 20,000.00 RMB.” The receipt also includes Zhou’s name and mobile phone number.

During the first instance proceedings, at the request of Jin Seed Industry Company, the Nanjing Intermediate People’s Court of Jiangsu Province commissioned a Hangzhou branch of a plant variety testing center to identify the variety of the allegedly infringing seeds. The identification opinion was that the allegedly infringing seeds and the standard sample of “Jinjing 818” rice seeds were “very similar or the same variety”.

Judgment

On January 22, 2021, the Nanjing Intermediate People’s Court of Jiangsu Province issued Civil Judgment No. （2020）苏01民初773号: 1. QinXX Agricultural Company shall immediately cease infringing upon JinXX Seed Industry Company’s exclusive right to implement the new plant variety “Jinjing 818” from the date the judgment takes effect; 2. QinXX Agricultural Company shall compensate JinXX Seed Industry Company for economic losses and reasonable expenses for safeguarding its rights, totaling RMB 3 million, within 15 days from the date the judgment takes effect. Dissatisfied with the judgment, QinXX Agricultural Company appealed to the Supreme People’s Court. On August 25, 2021, the Supreme People’s Court issued Civil Judgment No. （2021）最高法知民终816号: The appeal was dismissed, and the original judgment was upheld.

Judicial Reasoning

The central issue in this case is whether the actions of Qin Agricultural Company infringed upon the plant variety rights of “Jinjing 818”.

Generally, when both the buyer and seller reach an agreement on the terms of the sale of the subject matter, a sales contract is legally established, constituting a sale in the legal sense. In the transaction in question, QinXX Agricultural Company published seed supply information through a WeChat group; investigators commissioned by JinXX Seed Industry Company learned from QinXX Agricultural Company that “Jinjing 818” seedlings in white packaging were for sale. After signing the “Joint Farm Franchise Agreement” and making payment, QinXX Agricultural Company provided the so-called “supplier” information to JinXX Seed Industry Company; JinXX Seed Industry Company obtained the allegedly infringing seeds according to QinXX Agricultural Company’s arrangements. In the above transaction process, the quantity of seeds and the approximate delivery time were confirmed by QinXX Agricultural Company, and the price of the seeds was determined by QinXX Agricultural Company. QinXX Agricultural Company carried out the actions of publishing specific information about the sale of the allegedly infringing seeds and negotiating and determining the packaging method, price, quantity, performance period, and other transaction conditions for the sale of the seeds, and the sales contract was legally established. QinXX Agricultural Company was the organizer and decision-maker of the allegedly infringing seed transaction, and it can be determined that it directly carried out the act of selling the allegedly infringing seeds, constituting an infringement of the plant variety rights of “Jinjing 818”. The so-called signing of franchise agreements and delivery by third parties are intended to conceal the fact that they directly sold the allegedly infringing seeds.

QinXX Agricultural Company, a professional distributor of seeds and agricultural supplies, knowingly sold infringing seeds in unauthorized propagation materials of authorized varieties, despite the infringement. The company used unlabeled white bags to sell the allegedly infringing seeds. It organized buyers and sellers through online channels, using “information matching” to conceal its sales activities. It disguised the infringement by claiming that farmers were selling surplus conventional seeds for their own use. The company claimed to serve over 2 million mu of farmland, reaching more than 4,600 large-scale grain growers in Jiangsu, Shandong, Henan, and Anhui provinces. Combined with other evidence, this demonstrates the wide scope and large scale of its infringement. Qinmou Agricultural Company’s actions constituted intentional infringement with serious consequences, and punitive damages should be applied.

Relevant legal provisions

Articles 28 and 37 of the Seed Law of the People’s Republic of China (amended in 2021) apply to this case (Articles 28 and 37 of the Seed Law of the People’s Republic of China as amended in 2015 also apply).

Articles 4 and 12 of the “Several Provisions of the Supreme People’s Court on Specific Application of Law in the Trial of Disputes over Infringement of Plant Variety Rights (II)” (Fa Shi [2021] No. 14)

Guiding Case No. 276

Nuo XX Co., Ltd. v. China National Intellectual Property Administration (CNIPA), and third party Dai XXliang

Invention Patent Invalidation Administrative Dispute Case

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Administrative/Invention patent invalidation/Inventiveness/Reasonable expectation of success/Closest prior art/Technical inspiration

Key points

1. In patent cases in the chemical and biological fields, when using the “three-step method” to determine whether a patent possesses inventiveness, whether a person skilled in the art has a reasonable expectation of success regarding the invention is a factor in determining whether there is a motivation for improvement or technical inspiration, rather than a factor in determining the closest prior art. If a party denies the determination of the closest prior art on the grounds of a lack of reasonable expectation of success, the People’s Court will not support such a claim.

2. In the adjudication of patent cases in the chemical and biological fields, the determination of whether there is a reasonable expectation of success should be based on whether a person skilled in the art would consider it “necessary to attempt,” without requiring “certainty of success” or “high probability of success.” If a person skilled in the art has the motivation to attempt from the closest prior art and can reasonably expect to obtain a patented technical solution, the patented technical solution can be deemed to lack inventiveness.

Basic Case Facts

Nuo XX Co. is the patentee of the invention patent entitled “Pharmaceutical Composition Containing Valsartan and NEP Inhibitor” (hereinafter referred to as the patent in question). The patent application date was January 16, 2003, the priority date was January 17, 2002, and the authorization announcement date was April 8, 2015. Claim 1 of the patent in question defines a pharmaceutical composition containing valsartan and sacubitril, and claim 2 defines a pharmaceutical package of the pharmaceutical composition. The specification of the patent in question states that the pharmaceutical composition can be used to treat or prevent diseases such as hypertension, heart failure, and myocardial infarction.

On April 5, 2017, Dai XXliang filed an invalidation request with the Patent Reexamination Board of the former State Intellectual Property Office against the patent in question, and submitted 19 pieces of evidence in the invalidation proceedings. Among them, Appendix 13 is a copy of the European patent application published on February 4, 1992, and a partial Chinese translation, disclosing a composition of NEP inhibitors and angiotensin II receptor antagonists for the treatment of hypertension and congestive heart failure; Appendix 12 is a copy of the US patent application published on June 8, 1993, and a partial Chinese translation, disclosing that sacubitril and its pharmaceutically acceptable salts are NEP inhibitors and can be used to treat hypertension; Appendix Item 14 is an article titled “Research on a New Antihypertensive Drug—Valsartan, an Angiotensin II Receptor Blocker” published in the Chinese Journal of New Drugs (Vol. 8, No. 9, 1999), which discloses that valsartan belongs to the angiotensin II antagonist class, and its antihypertensive effect is no less than that of various existing antihypertensive drugs, with fewer adverse reactions. Attachment 15 is an article titled “A Novel Angiotensin II Receptor Antagonist: Valsartan” published in the Medical Guide (Vol. 20, No. 3, March 2001), which discloses that valsartan belongs to the angiotensin II antagonist class, plays a key role in regulating systemic blood pressure and maintaining electrolyte and fluid balance, and has the advantages of being safe, long-lasting, convenient to take, having mild adverse reactions, and being inexpensive.

On December 27, 2017, the State Intellectual Property Office issued a decision (hereinafter referred to as the challenged decision) stating that claims 1 and 2 of the patent in question lacked inventiveness in relation to the combination of Annexes 13 with Annexes 12, 14, and 15, and therefore declared the patent in question entirely invalid. Dissatisfied with the judgment, Nuo XX Company filed a lawsuit with the Beijing Intellectual Property Court, requesting the revocation of the challenged decision and an order for the State Intellectual Property Office to issue a new decision.

Judgment

On June 26, 2019, the Beijing Intellectual Property Court issued Administrative Judgment No. （2018）京73行初6483号, dismissing the lawsuit filed by Nuo XX Company. Nuo XX Company appealed to the Supreme People’s Court. On June 30, 2021, the Supreme People’s Court issued Administrative Judgment No. （2019）最高法知行终235号, upholding the original judgment and dismissing the appeal. Nuo XX Company applied to the Supreme People’s Court for retrial. On September 29, 2022, the Supreme People’s Court issued Administrative Ruling No. 2022）最高法行申72号, dismissing Nuo XX Company’s application for retrial.

Judicial Reasoning

In this case, the appealed decision held that claims 1 and 2 of the patent in question lacked inventiveness relative to the combination of Annexes 13 and 12, 14, and 15, essentially using Annex 13 as the closest prior art. No. 1 Company, however, argued that Annex 13 did not possess a reasonable expectation of success in obtaining the patent’s technical solution, and therefore did not constitute a qualified closest prior art. This argument conflates two different levels of issues: first, whether Annex 13 can be considered the closest prior art for evaluating the patent’s inventiveness; and second, whether a person skilled in the art would have a reasonable expectation of success in obtaining the patent’s technical solution based on Annex 13 and its impact on the assessment of the patent’s inventiveness.

I. Regarding whether Appendix 13 can be considered the closest prior art for evaluating the inventiveness of the patent in question.

The “three-step method” is a commonly used method for judging inventiveness in patent examination practice. Its basic steps are: First, identify the prior art closest to the patented technical solution; second, clarify the distinguishing technical features between the two, and based on the function and role of the distinguishing technical features in the patented technical solution, determine the objective technical problem that the patented technical solution needs to solve; finally, determine whether there is technical inspiration, that is, examine whether the prior art as a whole provides technical inspiration to combine the closest prior art with the distinguishing technical features to obtain the patented technical solution, and whether such technical inspiration would motivate a person skilled in the art to improve the closest prior art and obtain the patented technical solution when facing the corresponding technical problem. If such technical inspiration exists, the invention is considered to lack inventiveness. Identifying the closest prior art is the first step of the “three-step method.” In principle, the core consideration in identifying the closest prior art is whether the prior art and the invention address the same or similar technical problem and have the same or similar technical objectives. Furthermore, it is necessary to consider whether the prior art and the invention’s technical solution are sufficiently similar. Whether a person skilled in the art would have a reasonable expectation of success in inventing an invention based on the closest prior art typically depends on whether there were cognitive limitations that would hinder their ability to invent the invention before the filing date or priority date. This is a factor to consider when determining the existence of technical instruction after identifying the closest prior art, rather than a necessary or preferred factor for determining the closest prior art. For an invention for which protection is sought, even if prior art with the same technical problem, technical objective, and sufficiently similar technical solution is identified as the closest prior art, a person skilled in the art may still lack a reasonable expectation of success in inventing the invention based on that closest prior art due to limitations in technical knowledge or research and development conditions before the filing date or priority date. This may make it difficult for them to have the motivation to combine the closest prior art with other prior art or common knowledge to obtain an inventive technical solution. However, this cannot overturn the determination of the closest prior art. Of course, if the closest prior art is clearly infeasible, a person skilled in the art would not develop an invention solely based on that infeasible prior art. In principle, such infeasible prior art is not suitable as the closest prior art.

In this case, Appendix 13 addresses the same or similar technical problem and has the same or similar technical objectives as the patent in question. The technical solutions are also sufficiently similar, making it the closest prior art for evaluating the inventiveness of the patent in question. No. 13 argues that a person skilled in the art would not have a reasonable expectation of success in obtaining the patent’s technical solution based on Appendix 13, citing reasons such as the complexity of the drug’s mechanism of action and the existence of specific embodiments that cannot achieve the technical effect. Therefore, No. 13 is not considered a qualified closest prior art. Essentially, No. 13 attempts to overturn the determination of the closest prior art based on the lack of a reasonable expectation of success. As mentioned above, whether a person skilled in the art would have a reasonable expectation of success in obtaining the invention based on the closest prior art is, in principle, not a necessary or preferred factor in determining whether a prior art is the closest prior art. It is more appropriate to consider this in the third step of the “three-step method.” No. 13’s claim to deny its status as the closest prior art based on the above reasons lacks basis and should not be supported.

II. Regarding whether a person skilled in the art, based on Appendix 13, has a reasonable expectation of success in obtaining the technical solution of the patent in question, and its impact on the assessment of the inventiveness of the patent in question.

Given that the closest prior art has already disclosed the medicinal functions of two known combinations of compounds, the patent in question is essentially developing a specific composition with medicinal effects. In this case, the “reasonable expectation of success” regarding the medicinal effects of the specific compound combination is a crucial factor in determining “technical inspiration.” If a person skilled in the art does not have a reasonable expectation of success regarding the medicinal effects of the specific compound combination, but the patent applicant still makes an attempt and obtains a corresponding specific composition with medicinal functions, then that specific pharmaceutical composition can generally be considered inventive. If a person skilled in the art has a reasonable expectation of success regarding the medicinal effects of the specific compound combination, then only if verifying the medicinal effects of the specific composition requires inventive effort, or if unexpected technical effects are achieved, can the specific pharmaceutical composition be considered inventive.

A reasonable expectation of success is an objective assessment and rational prediction by a person skilled in the art, based on their technical knowledge and general experimental conditions in the field, of the likelihood of obtaining a patented technical solution from the prior art before the application date or priority date, and does not depend on the subjective will of the patent applicant. A reasonable expectation of success only requires that a person skilled in the art deems it “necessary to attempt,” without requiring “certainty of success” or “high probability of success.” Having a reasonable expectation of success typically does not presuppose that the attempt will necessarily or highly likely achieve the technical objective or solve the technical problem; it only requires that a person skilled in the art, after comprehensively considering factors such as the existing technical situation in the specific field, the characteristics of technological evolution, innovation models and conditions, average innovation costs, and overall innovation success rates, still not abandon such an attempt.

Nuo XX argues that a person skilled in the art would not have a reasonable expectation of success with the patented technology in question (i.e., the combination of valsartan and sacubitril for the treatment of hypertension), primarily based on the following reasons: angiotensin II antagonists and NEP inhibitors exhibit contradictory and complex physiological effects; Annex 13 acknowledges the unpredictability of the mechanisms of action of angiotensin II antagonists and NEP inhibitors without providing any conclusions; and the combination of angiotensin II antagonists and NEP inhibitors has a “blow”—the inability to achieve a blood pressure-lowering effect. The specific analysis is as follows: Annex 13, as the closest prior art, discloses a technical solution for treating hypertension using a combination of angiotensin II antagonists and NEP inhibitors, and specifies relevant experimental methods, experimental conclusions, administration methods, and treatment dosages. It provides clear technical guidance for a person skilled in the art to select specific angiotensin II antagonists and specific NEP inhibitors for the treatment of hypertension. Given that Annex 13 provides clear guidance on the medicinal functions of typified drug combinations, and other options exist for specific drug combinations, even if the development of a specific drug combination with the relevant medicinal function lacks “certainty of success,” it is insufficient to prove that a person skilled in the art would abandon the development of a combination of a specific angiotensin II antagonist and a specific NEP inhibitor with antihypertensive function based on Annex 13. Furthermore, considering that Annex 12 discloses that sacubitril is an NEP inhibitor and can be used to treat hypertension, and Annexes 14 and 15 disclose that valsartan is an angiotensin II antagonist with antihypertensive effects, it can be concluded that a person skilled in the art has an incentive to attempt to obtain a pharmaceutical composition containing valsartan and sacubitril for the treatment of hypertension, based on Annex 13, and can reasonably expect to obtain such a composition. In other words, a person skilled in the art has a reasonable expectation of success in obtaining the patented technical solution from Annex 13, and the patented technical solution lacks inventiveness.

Relevant legal provisions

Article 22, Paragraph 3 of the Patent Law of the People’s Republic of China (amended in 2020) (Article 22, Paragraph 3 of the Patent Law of the People’s Republic of China as amended in 2000 applies to this case)

Guiding Case No. 277

Jiangsu HongXX Rotary Compensator Technology Co., Ltd. v. Jiangsu YuanXX Bellows Limited Liability Company et al. Patent Infringement Dispute Case

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Infringement of Invention Patent Rights/Infringement Comparison/Product Drawings/Physical Objects Difficult to Obtain or Disassemble

Key points

In patent infringement determination, there may be objective obstacles to obtaining or disassembling the physical object of the accused infringing product, making it impossible to use the physical object as a basis for technical comparison. However, if there is evidence that the drawings of the accused infringing product are highly consistent with the physical object, the people’s court may use the drawings as a basis for technical comparison. For the technical features of the product under normal working conditions as defined in the claims, the technical features of the accused infringing product under normal working conditions, which can be obtained by a person skilled in the art through analysis of the drawings, may be compared.

Basic Case Facts

On August 11, 2006, Song XXgen applied to the State Intellectual Property Office for an invention patent entitled “High-Pressure Resistant Rotary Compensator for Pipelines,” which was granted on October 17, 2007, with patent number ZL200610******.*. On May 17, 2011, Song XXgen transferred the patent right to Jiangsu HongXX Rotary Compensator Technology Co., Ltd. The patent was still under patent protection at the time of the litigation. Claim 1 of the patent claims is: “A high-pressure resistant rotary compensator for pipelines, comprising a core tube (1), a sealing gland (3), a sealing seat (5), and a connecting pipe (7), one end of the core tube (1) is inserted into the connecting pipe (7), the connecting pipe (7) is fixedly connected to one end of the sealing seat (5) and fitted onto the core tube (1), at least one annular outer boss (8) is provided on the end of the core tube (1) that extends into the connecting pipe (7), at least one annular inner boss (9) is provided on the inner surface of the sealing seat (5), and the sealing gland (3) is fitted onto the core tube (1); the sealing gland (3) and the sealing seat (5) are inserted into the other end of the sealing seat (5) and abut against the annular seal (4) installed between the inner surface of the sealing seat (5) and the outer surface of the core tube (1); the sealing gland (3) and the sealing seat (5) are connected by a connector (2). The characteristic is that at least one sealing cavity is formed between the sealing seat (5) and the core tube (1), which is formed by the inner surface of the sealing seat (5), the outer surface of the core tube (1), and the sides of the annular outer boss (8) and the annular inner boss (9); an end face seal (6) is installed in the sealing cavity, and the size of the sealing cavity remains basically unchanged. ” Claim 3 is: “The high-pressure resistant rotary compensator for pipelines according to claim 1 is characterized in that the sealing element (4, 6) is a high-temperature and high-pressure resistant sealing material.” Claim 4 is: “The high-pressure resistant rotary compensator for pipelines according to claim 1 is characterized in that the connecting pipe (7) is a reducing pipe joint, and the pipe diameter of the end that is fixedly connected to the sealing seat (5) is larger than the pipe diameter of the end that is connected to the pipeline.” The background technology stated in the patent specification is: “Currently, traditional sleeve-type, corrugated pipe-type, and steel ball-type pipeline compensation devices have been gradually replaced by rotary compensators due to their complex structure, high cost, inconvenient installation, and small compensation amount. The rotary compensators currently in widespread use have a simple structure, are easy to manufacture, and have a large compensation amount.” Advantages. However, in practical use, it has been found that due to problems with the sealing structure, end-face leakage occurs, especially when transporting high-temperature and high-pressure media. Therefore, the sealing structure must be improved to meet the requirements of high-temperature and high-pressure pipelines. The invention states: “The purpose of this invention is to address the problem of poor high-temperature and high-pressure sealing performance of existing rotary compensators by designing a high-pressure resistant rotary compensator for pipelines with a new sealing structure.” The advantages of the invention are: “Because in a relatively sealed closed cavity, the expansion coefficient of the sealing element is greater than that of the cavity, therefore, the higher the temperature and pressure, the better the fit between the sealing element and the end face, resulting in a better sealing effect,” and “It can be applied to the compensation of various high-temperature and high-pressure media pipelines.” The last paragraph of the patent specification states: “In summary, adding an end-face sealing element to the existing rotary compensator is the key to this invention; any method that solves the leakage of rotary compensators by adding an end-face sealing element is considered to be covered by this invention.”

In 2013, Guangxi XXwan Thermal Power Co., Ltd. purchased rotary compensators manufactured by Jiangsu YuanXX Corrugated Pipe Co., Ltd. through public bidding for use in a petroleum heating steam pipeline project. The purchase contract and supplementary contract signed by the buyer and seller stipulated that: 122 rotary compensators were purchased at a unit price of RMB 43,640 per unit; 3 corrugated compensators were purchased at a unit price of RMB 33,997.5 per unit, for a total contract price of RMB 5,426,072.5. The detailed design drawings (installation design) and technical guidance scheme proposed by the seller and confirmed at the liaison meeting between the two parties shall not be changed or modified without the buyer’s written consent. However, the buyer has the right to propose changes or modifications to adapt to site conditions and shall give written notice to the seller, who shall give full consideration and try to meet the buyer’s requirements. The technical agreement for the compensator signed by the buyer and seller stipulates that the rotary compensator must be high-temperature and high-pressure resistant, self-sealing, maintenance-free, leak-proof, and thrust-free. Its sealing structure must have double sealing on both the annular and end faces. The main structure consists of a core tube (rotating cylinder), sealing seat (outer sleeve), reducing pipe, sliding ring (sealing ring), packing flange, and sealing packing. The seller must provide the rotary compensator for on-site dissection or inspection free of charge, and the buyer will conduct random on-site inspections to ensure compliance with the technical agreement requirements. The completed product should be consistent with the final confirmed drawings. If the seller’s technical personnel further modify the drawings during on-site installation, the seller must compile the drawings into a new booklet, formally submit it to the buyer, and guarantee that the installed equipment is completely consistent with the drawings. Appendix 11 is the attached drawing of the rotary compensator (hereinafter referred to as the attached drawing of the contract in question). This drawing shows that the sealing cavity contains a copper high-pressure resistant graphite composite gasket, and the sealing seat, core tube, etc., are made of 15CrMoG material. Guangxi XXwan Thermal Power Company confirmed after verification that it had not received any documents modifying the equipment drawings.

Jiangsu HongXX Technology Co., Ltd. also participated in the bidding for compensators in the pipeline project in question. The company’s initial quotation was: RMB 88,200 per rotary compensator and RMB 25,000 per corrugated compensator. 

In 2018, Jiangsu HongXX Technology Co., Ltd. sued Jiangsu YuanXX Corrugated Pipe Co., Ltd. and Guangxi XXwan Thermal Power Co., Ltd. for infringing its invention patent right for rotary compensators, requesting the court to order: 1. Jiangsu YuanXX Corrugated Pipe Co., Ltd. to immediately cease production and sales of infringing products; 2. Guangxi XXwan Thermal Power Co., Ltd. to immediately cease use of infringing products; 3. Jiangsu XXmou Corrugated Pipe Co., Ltd. to compensate Jiangsu HongXX Technology Co., Ltd. for economic losses of 5 million RMB.

Jiangsu HongXX Technology Co., Ltd. claims protection for three technical solutions: claims 1, 1 and 3, and 1 and 4. The comparison object is the content of the contract drawings and the patent claims. Jiangsu YuanXX Corrugated Pipe Co., Ltd. argues that there are differences between the contract drawings and the rotary compensator it actually supplied. Therefore, the contract drawings should not be used as a comparison object to determine whether the accused infringing product constitutes infringement. Even if the contract drawings are compared with the content of patent claims 1, 3, and 4, the accused infringing product uses a direct connection between the core tube and the connecting tube, which differs from the patent’s technical feature of “one end of the core tube is inserted into the connecting tube, and the connecting tube is fitted onto the core tube.” Functionally, they also have several differences, and therefore do not constitute equivalent features. The end-face seal of the accused infringing product is a copper high-pressure resistant graphite composite gasket. Due to its material flexibility and thermal expansion characteristics, the sealing cavity will shrink under high temperature and high pressure conditions, which differs from the patent’s technical feature of “the sealing cavity space remains basically unchanged.”

Judgment

On August 2, 2018, the Nanjing Intermediate People’s Court of Jiangsu Province issued Civil Judgment No. （2018）苏01民初366号: 1. Jiangsu YuanXX Corrugated Pipe Company shall immediately cease the production and sale of products infringing upon the invention patent right of Jiangsu HongXX Technology Company No. ZL200610******.* “High-Pressure Resistant Rotary Compensator for Pipelines” from the date the judgment takes effect; 2. Jiangsu YuanXX Corrugated Pipe Company shall compensate Jiangsu HongXX Technology Company for economic losses of RMB 4 million within 15 days from the date the judgment takes effect; 3. All other claims of Jiangsu HongXX Technology Company are dismissed. Dissatisfied with the judgment, Jiangsu YuanXX Corrugated Pipe Company appealed to the Jiangsu Provincial Higher People’s Court. On June 15, 2020, the Jiangsu Provincial Higher People’s Court issued Civil Judgment No. (2018）苏民终1267号: the appeal is dismissed, and the original judgment is upheld. Dissatisfied, Jiangsu YuanXX Corrugated Pipe Company applied to the Supreme People’s Court for retrial. On December 17, 2021, the Supreme People’s Court issued Civil Ruling No. (2021) 至最高法民申3831, rejecting the retrial application of Jiangsu YuanXX Corrugated Pipe Company.

Judicial Reasoning

The main points of contention in this case are: whether the attached drawings of the contract can be used as the basis for technical comparison in this case; and whether the accused infringing product has the technical feature of “the size of the sealed cavity remains basically unchanged” of the patent in question.

I. Whether the attached drawings of the contract in question can be used as the basis for technical comparison in this case.

In patent infringement determinations, the technical features of the accused infringing product are generally compared with the technical features of the patent claims. However, when obtaining or disassembling the accused infringing product is difficult, if there is sufficient evidence to prove the technical features the accused infringing product should possess, the proven technical features can be compared with the technical features in the patent claims. In this case, the accused infringing product is used in a fluid medium transmission pipeline. Disassembling the product from an operating transmission pipeline presents technical difficulties and would result in significant losses to public or third-party interests. According to the purchase contract and technical agreement for the product in question, the detailed design drawings (installation design) and technical guidance plan proposed by the seller and confirmed at a meeting between the two parties shall not be changed or modified without the buyer’s written consent; the completed product should be consistent with the final confirmed drawings; if the seller’s technical personnel further modify the drawings during on-site installation, the seller should compile the drawings into a new booklet, formally submit it to the buyer, and guarantee that the installed equipment is completely consistent with the drawings. Guangxi XXwan Thermal Power Company confirmed after verification that it had not received any documents modifying the equipment drawings. The product in question operates in a high-temperature, high-pressure environment and is classified as special equipment. The design and construction of such equipment adhere to strict industry standards, and any unjustified design modifications could potentially lead to serious safety hazards. Although Jiangsu YuanXX Corrugated Pipe Company claimed to have confirmed changes to the technical drawings with the user in question, it failed to submit evidence to prove this. Therefore, the existing evidence in this case demonstrates a high degree of consistency between the attached drawings of the contract in question and the actual product accused of infringement. Thus, the attached drawings of the contract in question, i.e., the drawings of the accused infringing product, can serve as the basis for technical comparison in this case.

II. Does the accused infringing product possess the technical feature of the patent in question, namely, “the size of the sealed cavity remains essentially unchanged”?

On this issue, a major point of contention between the parties is whether the accused infringing product possesses the same or equivalent technical feature as the “seal cavity size remains substantially unchanged” technical feature defined in claim 1 of the patent in question. Since this case uses drawings of the accused infringing product as the basis for technical comparison, and drawings typically only reflect the product’s static rather than operational state, this should be given full attention when comparing relevant technical features.

First, based on the purpose of the patent invention, it can be determined that the positional relationship between the relevant components defined in the patent claims represents the relationship of the product protected by the patent in its working state. Second, the accused infringing product and the patent in question achieve the same principle of end-face sealing. Under normal working conditions, the greater the pressure of the medium in the pipeline, the stronger the mutual compression between the inner and outer annular bosses of the sealing cavity and the end-face seal, the outer surface of the core tube, and the inner surface of the sealing seat, resulting in a better sealing effect. However, if the pressure generated by the medium or other external forces is too great, causing irreversible deformation of the solid seal, it will lead to damage to the end-face seal and an abnormal working state, which is a state that a person skilled in the art should avoid when using a rotary compensator. Therefore, considering the size of the sealing cavity under normal working conditions is of practical significance. Third, the sealing cavity in the attached drawings of the contract in question has the same structure as the patented sealing cavity. Although it can be seen from the partial view in the drawing that the cavity is not sealed, the boss on the core tube does not contact the inner surface of the sealing seat, and the boss on the sealing seat does not contact the outer surface of the core tube, this is clearly the state when the rotary compensator is not working. A person skilled in the art can analyze the changing trend of the size of the sealing cavity under normal working conditions based on this drawing. Finally, regarding the mechanical compression effect, the accused infringing product uses a solid sealing element—a copper-copper high-pressure graphite composite gasket—which maintains a relatively stable volume and shape under normal operating conditions below critical pressure. This results in only very minor deformation of the seal under the compression of the inner and outer annular bosses, keeping the size of the sealing cavity essentially constant. Even considering the thermal expansion characteristics of the materials, the coefficient of thermal expansion for both metals and graphite is on the order of 10⁻⁶/℃, having a negligible impact on the size of the sealing cavity. Jiangsu YuanXX Corrugated Pipe Company’s claim that the softness of graphite and the thermal expansion characteristics of the sealing cavity material would cause the sealing cavity to shrink under high temperature and high pressure conditions contradicts the normal operating principle of the product and lacks valid evidence. Therefore, the sealing cavity of the accused infringing product should maintain a essentially constant size under normal operating conditions, possessing the technical feature of claim 1 of the patent in question: “the size of the sealing cavity remains essentially constant.”

In summary, the accused infringing product possesses all the technical features of the corresponding claims of the patent in question, and the actions of Jiangsu YuanXX Corrugated Pipe Company constitute infringement.

Relevant legal provisions

Article 11, Paragraph 1 and Article 64, Paragraph 1 of the Patent Law of the People’s Republic of China (amended in 2020) (Article 11, Paragraph 1 and Article 59, Paragraph 1 of the Patent Law of the People’s Republic of China (amended in 2008) apply to this case)

Article 13 of the “Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Patent Dispute Cases” (Fa Shi [2001] No. 21, amended in 2020) (Article 17 of the “Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Patent Dispute Cases” amended in 2015 applies to this case)

Guiding Case No. 278

Fujian HengXX Technology Co., Ltd. v. Quanzhou RimXX Flow Instrument Co., Ltd. for filing a malicious intellectual property lawsuit and damages liability dispute

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Liability for damages arising from malicious intellectual property litigation/Malicious litigation/Basis of rights/Knowledge/Damages

Key points

If someone knowingly files a patent infringement lawsuit against another person despite knowing that their claim clearly lacks a legal basis or factual grounds, thereby harming the rights and interests of that person, it constitutes a malicious lawsuit that abuses litigation rights; if another person demands that the malicious litigant bear liability for infringement, the people’s court shall support such a demand in accordance with the law.

Basic Case Facts

Quanzhou RiXX Flow Instrument Co., Ltd. is the patentee of a utility model patent entitled “Built-in Digital Display Target Flow Meter” (hereinafter referred to as the patent in question), authorized on November 1, 2000. On March 1, 2006, the official website of the State Intellectual Property Office published an announcement that the patent in question had been terminated due to non-payment of annual fees. On May 23, 2006, RiXX Instrument Company filed a lawsuit in the Intermediate People’s Court of Quanzhou City, Fujian Province (hereinafter referred to as the first lawsuit) against Fujian HengXX Technology Co., Ltd. for infringing the patent in question by producing and selling “intelligent target flow meters” in 2005. RiXX Instrument Company requested the court to order HengXX Technology Company to cease infringement, apologize, eliminate the impact, and compensate for economic losses of RMB 200,000 and reasonable expenses for rights protection of RMB 25,000. On November 7, 2006, the Quanzhou Intermediate People’s Court of Fujian Province issued （2006）泉民初字第230号, finding that HengXX Technology Company’s actions did not infringe the patent right in question and dismissing all claims of RiXX Instrument Company. RiXX Instrument Company appealed. On March 20, 2008, the Fujian Provincial Higher People’s Court issued Civil Judgment （2007）闽民终字第23号, dismissing the appeal and upholding the original judgment. RiXX Instrument Company applied to the Supreme People’s Court for retrial. On November 14, 2008, the Supreme People’s Court issued Civil Ruling （2008）民申字第504号, ordering the Fujian Provincial Higher People’s Court to conduct a retrial. On December 20, 2014, the Fujian Provincial Higher People’s Court issued Civil Judgment （2009）闽民再终字第4号, finding that HengXX Technology Company’s actions constituted infringement of the patent right in question, therefore revoking the first-instance judgment and ordering HengXX Technology Company to cease infringement and compensate RiXX Instrument Company 125,000 RMB.

On December 25, 2015, RiXX company filed a second lawsuit in the Quanzhou Intermediate People’s Court of Fujian Province against HengXX Technology Company, alleging that HengXX Technology Company continued to produce and sell products infringing on the patent rights in question from May 2006, after being first sued, until 2010. HengXX Technology Company requested the court to order HengXX Technology Company to compensate it for economic losses of 3.5 million RMB. HengXX Technology Company submitted evidence that the patent rights in question had been terminated by the State Intellectual Property Office on March 1, 2006. On May 23, 2016, RiXX instrument company applied to withdraw the lawsuit. On May 25, 2016, the Quanzhou Intermediate People’s Court of Fujian Province issued Civil Ruling No. （2016）闽05民初17号 allowing the Ri XX instrument company to withdraw the lawsuit.

On January 4, 2017, RiXX instrument company filed an administrative lawsuit with the Beijing Intellectual Property Court against the State Intellectual Property Office for terminating the patent right in question. On July 2, 2018, the RiXX instrument company applied to withdraw the lawsuit. On July 6, 2018, the Beijing Intellectual Property Court issued Administrative Ruling No. （2017）京73行初31号, allowing the RiXX instrument company to withdraw the lawsuit.

On May 27, 2019, the RiXX instrument company filed a lawsuit in the Intermediate People’s Court of Fuzhou City, Fujian Province (hereinafter referred to as the third lawsuit) against HengXX Technology Company for the alleged infringement in the second lawsuit, requesting the court to order HengXX Technology Company to compensate it for economic losses of 4.5 million RMB. The Intermediate People’s Court of Fuzhou City, Fujian Province, ruled to transfer the case to the Intermediate People’s Court of Xiamen City, Fujian Province. On June 4, 2020, the RiXX instrument company applied to withdraw the lawsuit. On June 10, 2020, the Intermediate People’s Court of Xiamen City, Fujian Province, issued Civil Ruling No. （2020）闽02民初346号, allowing the RiXX instrument company to withdraw the lawsuit.

On July 8, 2020, the RiXX instrument company filed a lawsuit with the Intermediate People’s Court of Xiamen City, Fujian Province, with the same requests and grounds as in the third lawsuit (hereinafter referred to as the fourth lawsuit). On February 8, 2021, the Intermediate People’s Court of Xiamen City, Fujian Province, issued Civil Judgment No.（2020）闽02民初963号, dismissing all of the RiXX instrument company’s claims. Dissatisfied, the RiXX instrument company appealed to the Supreme People’s Court, but failed to pay the case acceptance fee as required by law and applied to withdraw its appeal. On June 9, 2021, the Supreme People’s Court issued Civil Ruling No.（2021）最高法知民终921号, ruling that the case was treated as an automatic withdrawal of the appeal.

In January 2022, HengXX Technology Company filed this lawsuit with the Intermediate People’s Court of Xiamen City, Fujian Province, claiming that RiXX Instrument Company maliciously filed the aforementioned third and fourth lawsuits despite knowing that the patent in question had been terminated, thereby damaging the legitimate rights and interests of HengXX Technology Company. HengXX Technology Company requested the court to order RiXX Instrument Company to apologize to HengXX Technology Company and compensate for economic losses and reasonable expenses for safeguarding its rights, totaling RMB 500,000.

Judgment

On July 8, 2022, the Intermediate People’s Court of Xiamen City, Fujian Province, issued Civil Judgment No. （2022）闽02民初151号, ordering Ri XX Instrument Company to compensate Heng XX Technology Company for economic losses and reasonable expenses for safeguarding its rights in the amount of RMB 60,000, and dismissing Heng XX Technology Company’s other claims. Dissatisfied with the judgment, Ri XX Instrument Company appealed to the Supreme People’s Court. On October 30, 2023, the Supreme People’s Court issued Civil Judgment No. （2022）最高法知民终1861号, dismissing the appeal and upholding the original judgment.

Judicial Reasoning

The central issue in this case is whether HengXX Technology Company’s claim that RiXX Instrument Company’s third and fourth intellectual property lawsuits constitute malicious litigation is valid, and if so, how should the company bear the responsibility?

In this case, the key to determining whether the third and fourth lawsuits filed by RiXX instrument company constituted malicious litigation lies in judging whether the company knowingly filed patent infringement lawsuits despite the lack of legal or factual basis, and whether it acted maliciously in the face of the resulting damages.

First, the patent right in question was officially terminated on March 1, 2006, and this termination status has been established. Therefore, the third and fourth lawsuits clearly lack a legal basis. The RiXX instrument company failed to pay the patent annuity as required, and the patent right in question was officially terminated by the State Intellectual Property Office on March 1, 2006. Although the RiXX instrument company disagreed with the State Intellectual Property Office’s decision to terminate the patent right and filed an administrative lawsuit on January 4, 2017, it withdrew the lawsuit in July 2018. Therefore, the state of the patent right in question—unprotected by law—has been established.

Secondly, the RiXX instrument company was aware that its third and fourth lawsuits lacked a legal basis. The RiXX instrument company admitted that it was aware of the termination of the patent in question in May 2016 (the second lawsuit) and therefore withdrew its lawsuit. Its third and fourth lawsuits both targeted the actions of HengXX Technology Company after the termination of the patent, thus clearly lacking a legal basis. Furthermore, the RiXX instrument company retained legal representation in both the third and fourth lawsuits. The RiXX instrument company should have been clearly aware that its lawsuits lacked a legal basis; under these circumstances, its continued filing of patent infringement lawsuits can be considered an attempt to seek or allow HengXX Technology Company to suffer harm as a result of the litigation.

Thirdly, the actions of the RiXX instrument company in its third and fourth lawsuits have caused losses to others. Due to the third and fourth lawsuits filed by the RiXX instrument company, HengXX Technology Company had to incur legal fees and other expenses. Furthermore, the property preservation measures taken against HengXX Technology Company at the request of the RiXX instrument company in the fourth lawsuit also caused losses to HengXX Technology Company. In addition, HengXX Technology Company has provided evidence that in several bidding activities it planned to participate in, the bidding parties required that there be no intellectual property disputes, and HengXX Technology Company lost bidding opportunities due to the lawsuits filed by the RiXX instrument company. All of the above losses arose from the third and fourth lawsuits filed by the Japanese instrument company and constitute tort damages.

In summary, the RiXX instrument company knowingly filed a third and fourth lawsuit despite its apparent lack of legal basis, constituting an abuse of litigation rights that harmed the legitimate rights and interests of others, and should be deemed to have engaged in malicious litigation. HengXX Technology Company suffered losses as a result, including lost business opportunities, litigation costs, and inability to properly use the preserved assets. The RiXX instrument company should bear corresponding tort liability for these losses according to law. Since HengXX Technology Company did not appeal, meaning it did not object to the amount of damages awarded in the first instance judgment, the second instance court will not adjust it.

Relevant legal provisions

Articles 120, 1165, and 1184 of the Civil Code of the People’s Republic of China

Guiding Case No. 279

XiXX Industrial Software Co., Ltd. sues Guangzhou WoXX Mold Co., Ltd. for infringement of computer software copyright dispute 

(Approved by the Judicial Committee of the Supreme People’s Court and released on February 28, 2026)

Keywords

Civil/Infringement of Computer Software Copyright/Substantial Similarity/Obstruction of Evidence Preservation/Adverse Consequences/Damages

Key points

1. In disputes involving infringement of computer software copyright, if the copyright holder can provide evidence to prove that the allegedly infringing software and the copyrighted software have the same unique information such as name, version number, and rights holder information, or that the software interface design is highly similar, the people’s court generally can determine that the two software programs are substantially similar without comparing the software code, unless the alleged infringer has contrary evidence sufficient to refute it.

2. In intellectual property infringement disputes, if the accused infringer obstructs the people’s court from preserving evidence by means of violence, threats or other methods, the people’s court may make a factual presumption against the accused in accordance with the law, including determining that the products that could not be preserved in accordance with the law constitute infringement, and taking the obstruction of evidence preservation as an infringing circumstance when determining the specific amount of compensation.

Basic Case Facts

XiXX Industrial Software Co., Ltd. alleged that it is the copyright holder of the NX series computer software. This series of software is computer software for the manufacturing industry and can be used for 3D design, digital simulation testing, and manufacturing assistance. Guangzhou WoXXX Mold Co., Ltd. mainly engages in the manufacture of mold products. WoXX Software Company’s unauthorized copying and commercial use of XiXX Software Company’s software in question infringed upon XiXX Software Company’s copyright and should bear legal responsibility for ceasing the infringement and compensating for losses. XiXX Software Company argued that its actual losses should be determined by multiplying the number of infringing software copies by the price of the genuine software in question. Therefore, it filed a lawsuit with the Guangzhou Intellectual Property Court, requesting a judgment ordering WoXX Mold Company to cease the infringement and compensate for economic losses and reasonable expenses for rights protection totaling RMB 2,712,827.

At the request of a software company, the Guangzhou Intellectual Property Court went to WoXX mold company to preserve evidence. The court explained in detail to the company’s on-site management the proposed preservation measures and the legal consequences of refusing to cooperate. An on-site count revealed 26 computers in the WoXX mold company’s office. After the Guangzhou Intellectual Property Court preserved evidence on 17 computers, 9 of which showed 13 sets of NX series computer software installed, the WoXX mold company suddenly took countermeasures, obstructing the evidence preservation work by refusing to turn on some computers and cutting off power. This forced the Guangzhou Intellectual Property Court to terminate the evidence preservation work, and the remaining 9 computers were not preserved. During the first instance trial, the Guangzhou Intellectual Property Court reprimanded the WoXX mold company for its obstruction of evidence preservation. The WoXX mold company also submitted a “Letter of Apology” to the court, apologizing for its obstruction of evidence preservation.

Judgment

On October 17, 2019, the Guangzhou Intellectual Property Court issued Civil Judgment No. （2018）粤73民初1099号: 1. Wo XX Mold Company shall immediately cease infringing upon the copyright of the software in question belonging to Xi XX Software Company; 2. Wo XX Mold Company shall compensate Xi XX Software Company for economic losses of RMB 500,000 and reasonable expenses for rights protection of RMB 100,000; 3. Xi XX Software Company’s other claims are dismissed. Both parties appealed after the judgment was pronounced. On November 19, 2020, the Supreme People’s Court issued Civil Judgment (2020）最高法知民终155号: 1. The first item of the Civil Judgment No. （2018）粤73民初1099号 of the Guangzhou Intellectual Property Court is upheld; 2. The third item of the Civil Judgment No.（2018）粤73民初1099号 of the Guangzhou Intellectual Property Court is revoked; 3. The second item of the Civil Judgment No. （2018）粤73民初1099号 of the Guangzhou Intellectual Property Court is amended to order Wo XX Mold Company to compensate Xi XX Software Company for economic losses of RMB 2,612,827 and reasonable expenses for rights protection of RMB 100,000. Wo XX Mold Company, dissatisfied with the judgment, applied to the Supreme People’s Court for retrial. On November 18, 2021, the Supreme People’s Court issued Civil Ruling No. （2021）最高法民申4246号: Wo XX Mold Company’s application for retrial is rejected.

Judicial Reasoning

The two main points of contention in this case are: first, whether Wo XX Mold Company infringed on the copyright of the software in question; and second, how to determine the quantity of infringing software and the amount of compensation.

I. Wo XX Mold Company infringed the copyright of the software in question.

According to Articles 10 and 48 of the Copyright Law of the People’s Republic of China (revised in 2010), the right of reproduction refers to the right to make one or more copies of a work by means of printing, photocopying, tracing, sound recording, video recording, dubbing, photographing, etc. Anyone who reproduces a work without the copyright holder’s permission shall, unless otherwise stipulated, bear civil liability including ceasing infringement, eliminating the impact, making an apology, and compensating for losses.

In this case, based on the evidence preservation, the Guangzhou Intellectual Property Court has determined that among the 17 computers of Wo XX Mold Company, 9 computers displayed copyright and version information for 13 sets of NX series computer software. Some of these software programs indicated that the copyright holder was Xi XX Software Company. Eight sets displayed version numbers NX8, two sets NX10, two sets NX11, and one set NX12. Given that the existing evidence proves that the accused infringing software is highly similar to the software in question from Xi XX Software Company (including having the same name, version number, and copyright holder information), it can be presumed that Wo XX Mold Company copied the copyrighted software from Xi XX Software Company without requiring software code comparison. In this case, Wo XX Mold Company should provide corresponding counter-evidence to refute this claim. However, Wo XX Mold Company has not provided evidence to prove that it purchased the software in question, nor has it provided evidence or a reasonable explanation of the differences between the accused infringing software it installed and the copyrighted software from Xi XX Software Company. Furthermore, Wo XX Mold Company also admitted that the accused infringing software was downloaded from the internet by its employees. In conclusion, it can be determined that Wo XX Mold Company copied the software in question without the permission of Xi XX Software Company, thus infringing on the copyright of Xi XX Software Company.

II. Determination of the Number of Infringing Software and the Amount of Compensation

Evidence preservation measures are an important component of civil litigation and a crucial means for the people’s courts to exercise their judicial power. When litigants or other individuals obstruct evidence preservation through violence, threats, or other means, they not only seriously violate the fundamental principle of procedural good faith but also constitute a serious obstruction of civil litigation, and should bear corresponding adverse consequences. Article 95 of the “Provisions of the Supreme People’s Court on Several Issues Concerning Evidence in Civil Litigation” (Fa Shi [2001] No. 33, amended in 2019) stipulates: “If a party in control of evidence refuses to submit it without justifiable reason, and the party bearing the burden of proof claims that the content of the evidence is unfavorable to the controlling party, the people’s court may determine that the claim is valid.” Upon investigation, in this case, during the evidence preservation process, even after the Guangzhou Intellectual Property Court had explained to Wo XX Mold Company that obstructing evidence preservation would be presumed to constitute the installation of infringing software and would incur corresponding adverse consequences, Wo XX Mold Company still took countermeasures, obstructing the Guangzhou Intellectual Property Court’s evidence preservation work by refusing to turn on some computers and cutting off power, resulting in the Guangzhou Intellectual Property Court failing to complete the preservation of the other nine computers involved in the case. Given that it has been confirmed that some of the computers that were preserved had the software in question installed, according to the aforementioned judicial interpretation, it should be presumed that the nine computers that were not preserved also had the software installed, and this should be taken into consideration when determining the amount of damages for infringement in this case.

In this case, the facts, such as the number of infringing software and the price of the genuine software, are relatively clear. Therefore, the amount of damages can be calculated based on the actual losses suffered by the copyright holder due to the infringement. The following factors were considered in the calculation: 1. Quantity of infringement. It is presumed that the software in question was installed on all nine computers that were not preserved. Therefore, Wo XX Mold Company copied at least 22 sets of the software, representing a significant number of infringements. 2. Popularity and price of the software in question. Xi XX Software Company’s software is applicable to industrial manufacturing, has a certain degree of popularity, and has high economic value. 3. Circumstances of Wo XX Mold Company’s infringement. Wo XX Mold Company obstructed the court’s evidence preservation in this case, which is a serious offense. Considering the above factors, the evidence on file proves that Xi XX Software Company’s actual losses significantly exceed the statutory damages limit of 500,000 RMB stipulated in Article 49 of the Copyright Law, and its claimed damages have a factual and legal basis. Therefore, Xi XX Software Company’s claim for damages is fully supported. Xi XX Software Company’s reasonable expenses, such as attorney fees, objectively exist, and the amount claimed does not exceed the reasonable range; these are also fully supported.

Relevant legal provisions

Articles 10, 53, and 54 of the Copyright Law of the People’s Republic of China (amended in 2020) (Articles 10, 48, and 49 of the Copyright Law of the People’s Republic of China (amended in 2010) apply to this case.

Article 95 of the Provisions of the Supreme People’s Court on Several Issues Concerning Evidence in Civil Litigation (Fa Shi [2001] No. 33, amended in 2019)