Small Company Defeats Giants

It can be hard to imagine an ant achieving victory over an elephant.

But a small Chinese high technology company recently was successful in a patent rights lawsuit against US-based software giant Microsoft and Finland’s mobile phone giant, Nokia.

"We legally apply and manage the patent right of our products, and we will insist on fighting against patent violations, no matter how strong our competitors are," CECIT Chairman Wang Jianbo said.

In 2008, China E-Commerce Info-Tech Co Ltd (CECIT), a private enterprise based in Xi’an in Shaanxi province, accused technology giant Microsoft, Nokia and mobile phone giant Sony-Ericsson of pirating its RSS (Really Simple Syndication)-related technology.

According to CECIT, Microsoft used the RSS information interactive processing approach in its Windows Vista software operating system without any licensing agreement.

Nokia and Sony-Ericsson also were accused by the company of pirating RSS technology.

In response, according to a statement released by Microsoft and Nokia, they argued that the RSS technology, due to its lack of creativity and novelty, should not be considered a patent belonging only to CECIT.

But this February, after consulting with the State Intellectual Property Office, Xi'an Intermediate People's Court judged that CECIT does hold the patent right for the RSS technology.

The court requested that Microsoft and Nokia stop the alleged violation of RSS technology. Thus, the two giants lost the first round of the case.

CECIT reported that it applied for the invention patent for its self-developed method to use the RSS service in 2005.

CECIT said it received a patent certificate from the State Intellectual Property Office in late 2007.

Microsoft and Nokia denied the violation, and sued the State Intellectual Property Office in Beijing No 1 Intermediate People's Court.

Beijing No 1 Intermediate People's Court accepted the case and had been considering the counter-lawsuit since the end of May.

But the case suddenly ended in mid-July, when Microsoft and Nokia jointly agreed to rescind their appeal and agreed to not use the RSS technology.

"In the final round of this dispute, as a matter of fact, CECIT achieved a victory and successfully protected its patent rights," a lawyer from Beijing-based Wisway Lawfirm, surnamed Yin, told China Business Weekly during a recent interview.

Microsoft and Nokia representatives were unavailable for comment on the case.

For Microsoft, the dispute with CECIT was not the first time the software giant was accused by a smaller Chinese company of patent infringement.

In 2007, Microsoft was involved in a patent infringement case with Beijing-based Zhongyi Electronic Ltd.

In that case, Zhongyi accused the software provider of using its inputting technology in Microsoft’s Windows operating system for more than a decade without a licensing agreement.

"It was necessary to maintain the integrity of our self-developed capacity, especially in the IT industry," Zheng Long, developer of the Zhengma inputting technology, said.

Similar to its initial response to CECIT, Microsoft argued that Zhongyi’s inputting technology was lacking in creativity and asked that the State Intellectual Property Office cancel Zhongyi’s patent right.

Microsoft lost that lawsuit, and Zhongyi maintains the patent for its inputting technology.

An industry insider told China Business Weekly that the cases reflect that China's enterprises have developed a stronger research and development base, especially in software.

"Along with fast-growing awareness of IPR (intellectual property rights) protection in China, China-based enterprises will grow to be the 'elephant', not just an 'ant', with their strong, self-developed capability and IPR protection awareness," he said.