China’s Top Judicial Body Will Recommend Establishment of a National IP Appeals Court

A senior IP academic has revealed that China’s Supreme People’s Court (SPC) will soon formally recommend the establishment of a national IP appeals court. The comments, made by Professor Wu Handong at an IP forum in Chengdu, were related by USPTO senior China counsel Mark Cohen on his blog. They signal the strongest indication to date that China’s top judicial policymakers consider the country’s experiment with specialised IP courts a success - and that is very good news for patent plaintiffs.

The SPC has already decided, Wu said, to recommend the creation of a body “similar to the US Court of Appeals for the Federal Circuit”. The National People’s Congress will need to sign off on any new body, and approval is very likely to be forthcoming if the SPC formally asks for it. Wu, a well-known IP academic and jurist, added that complex technology-based IP cases were likely to be the principal focus of such a venue. With the authority to review patent cases from throughout the country, including the IP courts in Beijing, Shanghai and Guangzhou, the new circuit court is almost certain to have a huge impact on patent practice in China.

Interestingly, Wu confirmed the plans for an appeals court in response to a question from former CAFC chief judge Randall Rader. Rader, who this blog recently reported as a candidate for the vacant USPTO director job, has spent considerable time in China of late, including in advisory roles for Chinese companies. Another interesting titbit from Cohen’s account is that the announcement of plans for an appeals court drew applause from the audience of IP professionals.

It appears that the intermediate level – where all patent disputes start – will also see more specialisation in the very near future. Four second tier cities – Wuhan, Nanjing, Suzhou and Chengdu – will be gettingspecialised IP tribunals that will have the jurisdiction to hear patent disputes across wide swathes of China’s industrial heartland.

The SPC seems to have reached a decision on specialised courts well before the three year trial period has passed. The bottom line on the new venues, and especially the Beijing IP Court, is that foreign parties seem to like them, plaintiffs seem to like them, and foreign plaintiffs seem to like them most of all. Developments like rising damages and an SEP-based injunction do not seem to have generated much in the way of pushback from those who would prefer to see reforms slowed or made less plaintiff-friendly – at least among top decision makers.

Taking the temperature of the local legal community, we found substantial enthusiasm for the idea. But there are also concerns, particularly around manpower. Are there enough experienced and qualified judges to staff the IP courts, the IP tribunals, and the IP appeals court? Given China’s centrality to the global technology market, a CAFC-like venue in Beijing will quickly become one of the most high-profile arenas in the patent world. Judges will be making big calls with big consequences on issues like nationwide injunctions and possibly large damage awards. Patent owners will want some assurance that the best IP judges the country has to offer will be the ones making those decisions.