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HK needs to get prepared for tech patent litigation cases

Post Time:2012-08-09 Source: Author: Views:
The trial in California of Apple vs Samsung last week reminds us of the importance of Apple's series of court cases in shaping intellectual property law. It also reminds us of the need to reform one of the most complex areas of common law. In February this year, Apple filed a lawsuit against Samsung, claiming the Korean rival copied Apple's design. The story is relatively simple: an inventor genius sues a shameless imitator. 

Both in the US and globally, Apple and Samsung have established themselves as fierce competitors in the smartphone market and also fierce adversaries in the court room. In April, over 40 related cases were identified. 

The US Supreme Court and the Federal Circuit have cautioned that because a preliminary injunction is granted before the defendant has had an opportunity to fully defend himself at trial, "a preliminary injunction is a drastic and extraordinary remedy that is not to be routinely granted." No such requirement has been accepted in Hong Kong. 

On the other hand, Hong Kong has followed the British House of Lords in the American Cyanamid v Ethicon case. This was also a case on an alleged infringement of a patent for use as absorbable surgical sutures. 

The Highest Court in England in the case of American Cyanamid had adopted a three pronged approach. It declared that the first test was that there had to be a serious question to be tried. Conflicts of evidence and difficult questions of law would not be dealt with. In this manner, the court expressly changed the previous test that there must be a prima facie case to prove. It is this change that had adopted a much lower threshold test in granting interlocutory injunction. 

The second test is that the court should go on to consider whether damages would be an adequate remedy. If so or that there is no irreparable damage, no interlocutory injunction should normally be granted. Thirdly, if there is doubt that an award of damages may not be an adequate remedy, the court will then consider the question of balance of convenience. There may be many special factors to be taken into consideration in the particular circumstances of individual cases. The discretion of the court will always play a significant role. 

With exercise of discretion, there is inevitably a risk of uncertainty, no matter how judicial the manner such discretion may be exercised. In order words it is possible that if and when Apple proceeds with its patent infringement actions in Hong Kong, there will bring into the territory great uncertainty of the outcome of an application for interim injunction. The law will not be satisfactory in this regard. The Apple patent is just an example of the unsatisfactory state of the procedural law on interlocutory injunction. 

However, reforming the rules on interlocutory injunction applications may not be a panacea to resolve the problem. What Hong Kong needs, if it is to be an international center for resolution of disputes, is to adopt a multi-pronged approach. First of all, there should be developed a knowledge data base on patent claims. At the moment many Hong Kong patent agents are essentially referral agents and not specialists on drafting of patent claims and specifications. This ought to be enhanced so that the court may be better and more efficiently served. 

Secondly, it should be recognized that the grant of technological oriented patent is also a grant of a monopoly. Monopoly is by definition an anti-competitive measure that might be contrary to at least the spirit of the new Competition law. Technology patents should only be granted in the clear case of a genuine invention, not to allow big companies to corner a market or to increase its market share for profit gain. 

Thirdly, there should be formulated a set of civil procedural rules to achieve greater certainty, for example, there should be better balance on the public interest to protect invention on the one hand, and to avoid anti-competitive measures that are not economically justifiable but to restrict market competition. 

The author is a HK barrister and chairman of the Hong Kong Bar's Special Committee on Planning and Policy. 
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