Stronger Protection for IP Right Holders in Taiwan

This year, we noticed from several Rulings that Taiwan IP Court is apt to afford stronger protection to IP right holders. In the past, the IP Court never awarded “triple damages”, a legal restitution embraced in Taiwan’s Patent Law and Fair Trade Act. However, this March, the IP Court awarded triple damages against an infringer in a design patent infringement lawsuit filed by HTC, a large smart phone maker. Based on the Fair Trade Act, HTC was also to receive triple damages for the infringement carried out before the grant of the design patent.

Unlike the United States or the United Kingdom, there is not a “discovery procedure” in Taiwan’s court proceedings. A plaintiff generally relies on Taiwan’s court to render a Disclosure Order against the defendant in the calculation of damages or impose a sanction on the defendant for non-compliance. While the IP Court rarely issued an order of sanction in the past, it awarded sanctions in no less than three patent infringement cases in 2017. What is also noteworthy is that the amount of damages awarded was as the plaintiffs calculated.

Another matter which merits mentioning is the standard adopted by the IP Court in the calculation of patent infringement damages, as well as the IP Court’s take on “contribution percentage.” In this July, the IP Court rendered a Ruling deeming that the defendant, a Taiwanese company, is liable for compensating Toshiba, the plaintiff, for infringing the plaintiff’s semiconductor IC related patent at the amount of 200 million Taiwanese dollars in the first instance. On the other hand, the IP Court denied the defendant’s percentage contribution claim. The IP Court held that, although the infringing NAND flash memory involves several other patented technologies, since the technical skills owned by the plaintiff are inseparable and indispensable to said product, there is no need to take the contribution percentage into account or else the percentage should be 100%.

In the case of trademark infringement, famous marks are often vulnerable to squatting. This August, in a civil trademark infringement lawsuit in which the two opposing parties are both motorcycle parts manufacturers based in Taiwan, the IP Court rendered a Decision in favor of the plaintiff in the second instance. The defendant was ordered to voluntary withdraw its trademark registrations for the plagiarized mark secured in Taiwan, China, and Australia. If said Decision becomes final and irrevocable in the future, it will be an indication of Taiwan IP Court’s intention to play a more active role in dealing with unfair competition on an international scale.

The above contents are intended as general discussion of the subject matter only and shall not be deemed as legal advice to any particular case or issue.