Patent case

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ALL-CLAD ARNO CALOR KRUPS LAGOSTINA MOULINEX ROWENTA SEB TEFAL Patent Right Enforcement in CHINA H KIEHL APRIL 2013

Patent Right Enforcement in CHINA 

INTRODUCTION SEB

Increase in patent filing

Experience in enforcing patent in CN (Actifry & Fresh Express cases)

Problems & difficulties in enforcing patent in CN

Conclusion

GROUPE SEB

is:

 The world leader of small domestic appliances.

 A mission : to improve the consumer's daily life : a "B to C" business.

 A strong innovation capacity : No. 20th in France with more than 100 new inventions applications per year since 2009  A strong trademarks portfolio : 4 major trademarks, 20 well known trademarks in their field.

 A worldwide presence : manufacturing in Europe, Brazil, USA and China, sales companies in any significant country.

 A stable shareholder association.

GROUPE SEB

is … innovation since the beginning

       Pressure cooker Cocotte minute® Non stick pan TEFAL® Smokeless fryer Steam station and enamel sole iron … Multi purpose food processor RONDO®, KALEO® On the table fun cooking (raclette , grills…) Mini vacuum cleaner DYMBO®, sucking head DELTA®

GROUPE SEB

is … innovation always today

      Low fat fryer Hot water on demand Silent vacuum cleaner Food processor with multiple colorful tools Multi recipes yogurt maker Round bread maker

The direct client : the distribution

Mass market

INTRODUCTION

Department stores Spécialist 6

What is Intellectual Property for SEB consumer ?

Product protection under its 3 components presented to the

How to fry with little oil : direct strong hot air flow to the bottom of a pan where a paddle gently turn over the food = THE TECHNICAL PATENT The name ACTIFRY to promote the buzz = THE TRADEMARK The Shape which attract the attention of the consumer = THE DESIGN

Patent Right Enforcement in CHINA 

Introduction to SEB

INCREASE IN PATENT FILING

Quality of anti-counterfeiting measures

Technical collaboration with Chinese company

Conclusion

Patent Right Enforcement in CHINA  Patents filing in China increased x5 between 2002 and 2012  In small house appliances, numerous "Utility Patent" for details between technical patent and esthetical patent.

 Fierce and fast competition among Chinese companies for export orders  Employee fast turn over raises question of weak confidentiality and lack of exclusivity  Government subsidize patent filing and "innovative" companies  Each variant of a subject may filed independently ( bread maker "baguette" rack )

Patent Right Enforcement in CHINA 

Introduction to SEB

Increase in Patent filing

Experience in enforcing patent in CN (Actifry & Fresh Express cases)

Problems & difficulties in enforcing patent in CN

Conclusion

IP Right counterfeit search : classic

The classical manner : local commercial companies run "store check" and send pictures and samples to IP Department

Written proof are requested

Internet watch both in English and in Chinese language

 www.alibaba.com

 www.amazon.cn

  www.360buy.com/product/ www.dhgate.com

,

IP Right counterfeit search : fairs

The major information source is the huge Chinese Export Fair taking place twice a year in Guangzhou (April, October)

A compulsory presence for Chinese small & medium size companies eager to export without having to maintain a costly foreign network.

Numerous arguable products are for markets "free of rights" (Iran, Irak, Afrique, etc.)

IP Right counterfeit search : classic

 Counterfeits does exists, at most 5/1000 of presented products.  Ransom of glory : under Confucianism the student reproduces the master.

 A Complaint Desk put early in place by organizers and run by IPO and AIC competent persons.

 Compulsory representation by a Chinese lawyer so that the complaint file is perfect (on IP rights and formal details)  When convinced, the IPO or AIC representative goes to the booth to have the counterfeit removed : possible fight.

IP Right counterfeit search : classic

 YIWU City : numerous shopping center for export, one dedicated only to Household appliances  One visit per year necessary to watch for counterfeits  As "quality engineer", it is normal to ask to visit the factory.

 Local AIC is willing to remove obvious counterfeit.

Patent case example : Actifry

Patent n

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1 PIONNIER : during Search –june 2004

Cooking method by stirring under heat flow

Patent n

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1b divisionnal during Développent -2006

Removable internal bowl

Patent n

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2 : During Search – June 2004 :

Hot air flow circuity

Patent N

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3 during development :

february 2006 Food stirring paddle

Patent N

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4 during development :

february 2006 Food stopping means

Patent Case Example: Actifry

In October 2009 (only two years after product launch), carbon copy of Actifry was displayed in the Fair: Complaint filed and copy removed, then a civil lawsuit.

One year later, another competitor (the “2 nd competitor”) modifies the product: halogen heating, fixed paddle for a turning bowl, but the heating flow stays the same : still withdrawn and a civil lawsuit is followed.

Patent Case Example: Actifry

After the civil lawsuit, the 2 nd competitor further modifies its product to try to go around Actifry patents: closes the airflow behind the bowl for a smaller flow just above, Court Action on removable bowl

Patent Case Example: Actifry

Other copies of Actifry: after the civil lawsuit, the competitor modified the product – doubles or removed the paddle

Patent Case Example: Fresh Express

Patent No. 1 Utility model on anti wedging means Patent No. 3 Utility model on the transparent cover for the cutting tools Patent No. 4 Design patent of the overall shape of Fresh Express Patent No. 2 Utility model on the driving organ

Patent Case Example- repeat infringement: Fresh Express

In October 2010, carbon copy of the Fresh Express was observed during the fair: complaint filed and removed by the IPO, then a civil lawsuit.

After the lawsuit, the competitor modified the overall shape but the modified product still infringed three um patents: two times of customs interception and two more civil lawsuits to finally stop the competitor from reproducing the relative patents again.

Patent Right Enforcement in CHINA 

Introduction to SEB

Increase in Patent filing

Experience in enforcing patent in CN (Actifry & Fresh Express cases)

Problems & difficulties in enforcing patent in CN

Conclusion

Problems & difficulties in enforcing patents in CN • • • • 

Collection of infringement evidence in a patent infringement case

Notarized purchase – sometimes it is unfeasible to arrange the notarized purchase when the infringer is very cautious Official preservation of evidence – ① some local courts do not go to the defendants’ domicile to conduct evidence preservation because the judges are overloaded; ② the preservation usually cannot be arranged timely.

Official preservation of property ① some local courts do not seize the infringing products as “property”; ② the preservation measure usually cannot be arranged timely, either.

Customs interception – high amount of customs bond

Patent case : IPO

 IPO was efficient to raid and destroy identical Design patent counterfeit (2002 – 2003)  Then, small modifications brought lengthy discussions between infringer and administration. IPO requests that the cases be transferred to Court  Court acted as powerful mediator as long as IP owner requests were reasonable (only destruction of product and of moulds, little monetary damages). But the question of evidence of counterfeit solely for export became difficult.  The draft fourth revision of China’s Patent Law may give the IPO more power to enforce patent.

Problems & difficulties in enforcing patent in CN 

Patent enforcement through the IPO -

Advantage • Some IPO (in Guangdong Province) can inspect the infringer to obtain evidence and identify the relative moulds • The procedure is comparatively more simple than a civil lawsuit Disadvantage • Some IPOs do not conduct the inspection • The IPO cannot force the infringers to pay monetary compensation • The administrative decision may go through the judicial review of the court before coming into effective

Problems & difficulties in enforcing patent in CN 

More power to be granted to local IPOs??

 If preliminary evidence is presented, can the local IPO help the patentee to conduct official inspection timely to secure the evidence?

 After the IPO secures the evidence, the patentee can go to court with the evidence collected by the IPO?

 Power to fine the infringer in case of repeat infringement?

Patent Right Enforcement in CHINA 

Introduction to SEB

Increase in Patent filing

Experience in enforcing patent in CN (Actifry & Fresh Express cases)

Problems & difficulties in enforcing patent in CN

CONCLUSION

THANKS FOR YOUR ATTENTION