China’s Supreme People’s Court Releases Guiding Opinions on Trial of Civil Cases Involving Intellectual Property Rights of E-commerce Platforms
On September 13, 2020, China’s Supreme People’s Court released the Guiding Opinions on Trial of Civil Cases Involving Intellectual Property Rights of E-commerce Platforms (关于审理涉电子商务平台知识产权民事案件的指导意见). The Opinions may make takedowns of infringing products sold on e-commerce platforms easier and more common. As Mark Cohen, prior U.S. IP Attaché in Beijing and now at Berkeley, stated, the “The Guiding Opinion should further help implement obligations set forth in Section 1 (E) of the Phase 1 Trade Agreement regarding ‘Piracy and Counterfeiting on E-Commerce Platforms.'”
Article 3 reads,
3. If an e-commerce platform operator knows or should be aware of an infringement of intellectual property rights by an operator [seller] on the platform, it should take necessary measures in a timely manner based on the nature of the right, the specific circumstances and technical conditions of the infringement, as well as the preliminary evidence that constitutes the infringement and the type of service. The necessary measures taken should follow the principle of reasonable prudence, including but not limited to removal, blocking, and disconnection of links. If the operators on the platform have repeatedly and deliberately infringed on intellectual property rights, the operators of the e-commerce platform have the right to take measures to terminate transactions and services. (emphasis added).
That Article 3 states “should be aware of” implies a requirement to actively look for infringement on e-commerce platforms and take the necessary measures specified. Simply responding to IP holder complaints may not be sufficient for an e-commerce platform and instead preemptive action may be required.
Article 11 defines “should be aware” of as:
1) Failure to perform legal obligations such as formulating intellectual property protection rules and reviewing the operating qualifications of operators on the platform;
(2) Where there is no review of the proof of rights of operators whose store types on the platform are marked as “flagship store”, “brand store”, etc.;
(3) Failing to adopt effective technical means to filter and block infringing product links containing the words “high imitation” and “fake goods”, and links to infringing products that are re-listed after the complaint is established; and
(4) Other circumstances where reasonable review and care obligations are not performed.
Elaborating on Article 42 of the e-commerce law, for a takedown, an IP holder should provide, per Article 5 of the Opinions, in writing, the intellectual property right certificate and the real identity information of the right holder; accurate information on the accused goods or services; preliminary evidence of the infringement; and a written guarantee of the authenticity of the notice, etc. More specifically, for patent infringement, the e-commerce platform may further require a comparison of technical features or design features (e.g., claim chart) as well as a utility model or design patent right evaluation report if the patent is not an invention patent (as utility models and design patents are not examined substantively).
Conversely, submitting false takedown notices “maliciously” in article 42 of the e-commerce is subject to double damages. Article 6 of the Guiding Opinions defines maliciously as “submitting forged or altered certificates of rights; submit false infringement comparison opinions [e.g., claim charts] and Expert Opinions; sending out notices knowing that the status of rights is unstable; knowing that the notice is wrong but still failing to withdraw or correct them in time; and repeatedly submitting wrong notices.
Similarly, per Article 8, the operator on the platform (seller) make malicious statements in response to a takedown notice, including: providing forged or invalid proof of rights and authorization; the response contains false information or is obviously misleading; the takedown notice has been accompanied by an effective judgment or administrative decision to determine infringement and the operator on the platform still issues a response; or it knows that the content of the response is wrong, but it still fails to withdraw or correct it in time.
The full text (Chinese only) is available here.