Amendments to Intellectual Property Case Adjudication Act (hereunder IPCA Act) were passed on February 15, 2023, and will take effect on August 30 of the same year. One point of said amendments is related to the infringement proof in Taiwan patent litigation. The new Article 35 of the IPCA Act stipulates that in cases of trade secret, patent and computer program copyright, when the plaintiff makes a preliminary showing of infringement by presenting sufficient evidence that causes the court to obtain its conviction on the likelihood of infringement, the defendant should specifically plead the charge and is not allowed to simply deny infringement; otherwise, the court may find the IP right owner’s assertions true.
On this topic, please refer to our article “The impact of the amendments of IPCA Act on the proof of patent infringement litigation”, which was published in the Taiwan Bar Journal in September 2022 (available at https://www.twba.org.tw/upload/article/20221215/5936f99a76a045e5a40b7c2711a6ad2d/5936f99a76a045e5a40b7c2711a6ad2d.pdf), discussing that Taiwan Code of Civil Procedure has regulated the defendant’s duties to submit document and provide information, which can relieve the plaintiff’s burden of proof to some extent, and the implementation of the new Article 35 of the IPCA Act will further facilitate the litigation proceeding in this respect. Our article also mentioned an IC patent infringement case to illustrate that usually the plaintiff’s preparations of reverse engineering results required for filing this kind of litigation are quite time-consuming and costly. If Article 35 could be applied, it is possible that the court may not have to require repeated reverse engineering conducted by a court appointed expert or institute during litigation, in order to enhance litigation economy. Recently, the Taiwan Intellectual Property and Commercial Court (hereunder IPC Court) rendered another IC patent infringement case (No. 2022 Civil Patent Suit 16, February 2023), in which the IPC Court required the defendant to plead specifically to the plaintiff’s infringement assertions and made decision in view of the plaintiff’s reverse engineering results.
The parties in this case are two driver IC design houses in Taiwan. The plaintiff requested a notary public to notarize the purchase of cell phones with the defendant's driver IC installed, sent the same to a Japanese reverse engineering company for circuit analysis, and filed a lawsuit with the results of such reverse engineering. The defendant argued the inadmissibility of plaintiff’s reverse engineering results, and challenged the plaintiff’s failure to prove that the driver IC analyzed was actually the defendant’s product. Although, in the end, the IPC Court ruled in favor of the defendant that the accused driver IC was not covered by the plaintiff’s patent scope, the court did adopt the plaintiff's circuit analysis results to determine the infringement without requiring repetition of reverse engineering to be conducted by a court appointed institute during the litigation. The IPC Court stated that the plaintiff had already obtained a bug report by operating the cell phone in front of the notary public, which can prove that the model number and the name of manufacturer of the driver IC installed in the phone belonged to the defendant. The circuit analysis report revealed that the serial number of the cell phone analyzed by the reverse engineering company was the same as that sealed by the notary public, and the driver IC of said analyzed cell phone was marked with the the defendant’s logo. Therefore, the IPC Court accepted the plaintiff’s reverse engineering results as a proof, affirming that it was from the notarized cell phone.
The IPC Court held that the defendant, also a driver IC design company, should be able to provide more credible results of reverse engineering or circuit design to challenge the plaintiff’s infringement analysis, but not merely question the admissibility of plaintiff’s infringement evidence. As such, the IPC Court ruled that the defendant did not prove the facts in its favor, and adopted the plaintiff's reverse engineering results to determine whether the defendant’s IC constitutes patent infringement.
In sum, the IPC Court, with respect to the burden of proof related to reverse engineering in said IC patent infringement case, ruled that the defendant should plead specifically to the plaintiff’s allegation, which is consistent with the new Article 35 of the IPCA Act. The application of said Article 35 to patent cases would be helpful to ease the plaintiff’s burden of proof, prevent the defendant's arbitrary or frivolous defenses from impeding the discovery of the truth, and effectively improve the exercise of patent rights in Taiwan. In future patent litigation especially involving the ability of IC reverse engineering or other extremely complicated testing by sophisticated instruments, when the plaintiff has presented the results of such reverse engineering or testing, the defendant must not merely deny without giving any reasons, but should also plead specifically to the plaintiff’s infringement allegation and evidence.