Chinese IP Law

This is a guest post by Camilla Hrdy (cahrdy@gmail.com), a Visiting Fellow with the Information Society Project at Yale Law School.

This blog post is informed by a fascinating conference I attended, New Developments in Chinese IP Law: Copyright Revisions and Enforcement Challenges, which took place at Berkeley Law yesterday. All the talks were very interesting but I’ve decided to report on the complementary comments made by Professor Mark Cohen of Fordham University School of Law and Professor Xuan-Thao Nguyen of SMU Dedman School of Law. Both professors provided some highly revealing, and for many perhaps surprising, insights on enforcement of intellectual property rights (“IPR”) in China.

Professor Cohen publishes the blog chinaipr.com and will be spearheading Fordham Law’s conferences on Chinese IP Law in January in Washington, DC and in April in New York. Professor Nguyen writes on a wide variety of intellectual property related issues. Her recent articles include Apologies as Intellectual Property Remedies: Lessons from China, 44 Conn. L. Rev. 883 (2012) and Trademark Apologetic Justice: China's Trademark Jurisprudence on Reputational Harm, U. Pa. J. Bus. L. (forthcoming).

Mark Cohen – Does China Really Have a “Culture of Copying”?

Professor Cohen debunked some major critiques of China’s approach to intellectual property law and cast doubt on the commonly asserted position that China has a “culture of copying.” Some of Professor Cohen’s points were backed up with particularly impressive data that is worth sharing here. Responding to the statement that there is clearly a need to foster “IPR consciousness” in China, Cohen pointed out that, in fact, China arguably has “the most litigious IP society in world.” It has the largest trademark and patent offices anywhere and very high patent and trademark rights per capita. Cohen conceded that a “big” IP environment does not necessarily mean a strong IP environment; but there is undeniably widespread “consciousness” of the presence and potential enforceability of intellectual property rights in China.

Cohen also addressed the common conception that intellectual property laws in China are designed only to protect foreigners and not the Chinese people themselves. This, he says, is just flat-out wrong. 97% of the IP litigation suits in Cohen’s data involved Chinese suing Chinese. Just over 2% were brought by foreigners. Over 99% of utility model patents in China are owned by Chinese; for invention patents (which are more heavily examined before issuance) the number is 78.8%. The real problem with IPR enforcement in China, Cohen concludes, is not a “culture of copying” but too much government bureaucracy. He sees signs of this particularly in a certain quirk of Chinese patenting behavior: most Chinese patents are filed in the autumn because subsidies, awards and other recognitions are awarded on a calendar year basis, meaning there is a rush at year’s end to file patents in order to benefit from those incentives and especially to use end-of-year money that would otherwise not be available the following year.

Xuan-Thao Nguyen – An Intellectual Property Rights System “For the People”

Following Professor Cohen’s bird’s-eye-view of enforcement of IPR in China, Professor Nguyen gave us a “bottom up” look based on her extensive review of actual opinions rendered by Chinese courts. She began by reciting some of the same data as Professor Cohen, showing the massive number of IP litigation suits brought in China and the strong presence of IPR in the public consciousness. She observed that, yes, many of these suits are brought by Chinese companies who believe they need to enforce their IPR in order to make profits and defend their turf. But in China, Nguyen argues, the notion of intellectual property rights protection is truly ingrained in the consciousness of the people – not just the corporate world. She cited several cases: a mother who brought a copyright suit with her three children against several museums based on her husband’s painting, which went all the way to the Higher People’s Court and won her damages; countless Chinese restaurants and bakeries bringing trademark suits against other establishments for using similar names. She remarked (to chuckles from several members of the audience, including Berkeley Law Professor Robert Merges) how remarkably dry many courts’ IP opinions can be, and observed that, in contrast, there is a “story telling” quality to the opinions issued by Chinese courts. They are incredibly fact specific, she said, with judges apparently recognizing the “human element” involved in arguments over misappropriation and infringement, and that at the end of the day the facts, as much as the rules, determine the outcome.