UC Berkeley

After the Chinese government enacted new policies to stimulate domestic innovation and patent activities, China has become a world leader in both patent applications and patent litigation. These major developments, together with the escalated U.S.-China trade tensions, have made China an integral but controversial venue of international patent protection. However, due to the lack of judicial transparency in China prior to 2014, there had been virtually no access to case data. Before 2014, all public knowledge about Chinese patent cases was obtained from either interpreting the plain text of Chinese law and regulations or analyzing a limited number of published cases that the Supreme People’s Court considered having significant social impact.

Patent cases in China are in need of a comprehensive empirical study. Taking advantage of the 2014 judicial reform and the public release of court documents in China, this article fills this gap by analyzing all publicly available patent infringement lawsuits and post-grant invalidity cases decided between 2014 and 2016 in China. Surprisingly, part of its findings disprove some long-standing beliefs about the Chinese patent system. One prominent example is that foreign parties fared much better than their Chinese counterparts. In infringement cases, foreign patentees were more likely to win than Chinese patent owners and received much higher damages. Moreover, foreign requesters succeeded more often in post-grant invalidation process than Chinese requesters.

This Article also collects statistics on a number of other characteristics of patent cases in China. It provides comprehensive data on several different aspects of the Chinese patent system. Some of the key findings include that the overwhelming majority of patent infringement lawsuits in China involved mechanical patents instead of electrical and chemical patents; that on average, patent owners had waited quite a long time before enforcement; that at most, only about 0.6% of all issued patents are ever subject to invalidity challenges; etc.

In addition to providing descriptive statistics, this article also conducts hypothesis testing, in an effort to identify potential predictors of the outcomes of patent cases in China. It finds that most variables tested in this article revealed significant predictive value. However, there are several exceptions. For infringement lawsuits, only one factor, economic regions, demonstrated no relationship with the amount of damages granted. Two factors, including plaintiffs’ residency and appeals, were not predictors of injunctions. For invalidity cases, prosecution length was not related to a patent’s validity.