JAPAN Trends and Developments Contributed by: Hideaki Kobayashi, Hirofumi Tada, Hiroyuki Kimura and Hiroyuki Ohno, Ohno & Partners
Extraterritorial Application of Japanese Patent Law in Cross-Border Infringement Cases Supreme Court framework for overseas server cases (Dwango v FC2) The Supreme Court rendered a decision regarding the issue of overseas servers on 3 March 2025, in Dwango v FC2 . In this case, the issue was whether the act of dis- tributing a program from a server located overseas to user terminals within Japan constitutes “provision via a telecommunication line” as set forth in Article 2, Paragraph 3, Item 1 of the Patent Act and “offering to transfer, etc” as set forth in Article 101, Item 1 of the same Act. The Supreme Court, while presupposing that the effects of patent rights are in principle subject to the doctrine of territoriality, held that, in light of the current situation in which advances in information and com- munication technology have made it easy to provide services across borders, the relevant act should be observed as a whole, and if it can be evaluated in substance as provision within Japan, the effects of the patent right should be deemed to extend thereto. On that basis, the Court affirmed the establishment of patent infringement, reasoning that the program dis- tribution in this case causes the effects of the inven- tion to be manifested on user terminals within Japan, and is carried out as part of services directed toward Japan. With the issuance of the Supreme Court decision in Dwango v FC2 , a certain standard has been estab- lished for cases in which servers are located overseas. Liability for overseas manufacturing: component suppliers and joint tort theories On the other hand, as cases where acts of implemen- tation overseas become an issue, there are situations in which a component manufacturer holds intellec- tual property rights such as patent rights, and an alleged infringer manufactures and sells components overseas, while the component manufacturer’s client manufactures finished products and imports them into Japan.
2. Tokyo District Court, 7 March 2019, Heisei 28 (Wa) 42833 et al, JPY5.06 billion; 3. Osaka District Court, 26 September 2024, Reiwa 4 (Wa) 3344, JPY3.06 billion; 4. Tokyo District Court, 12 October 1998, Heisei 5 (Wa) 11876, JPY3.06 billion; 5. Osaka District Court, 15 September 2022, Heisei 29 (Wa) 7384, JPY2.78 billion; 6. IP High Court, 22 December 2011, Heisei 22 (Ne) 10091, JPY1.8 billion; 7. Tokyo High Court, 31 October 2002, Heisei 12 (Ne) 2645, JPY1.58 billion; 8. Tokyo District Court, 14 February 2014, Heisei 23 (Wa) 16885, JPY1.57 billion; 9. IP High Court, 16 November 2023, Reiwa 3 (Ne) 10084, JPY1.55 billion; 10. Osaka District Court, 28 January 2010, Heisei 19 (Wa) 2076, JPY1.5 billion; 11. Tokyo District Court, 27 June 2002, Heisei 12 (Wa) 14499, JPY1.27 billion; 12. Osaka District Court, 27 May 2004, Heisei 14 (Wa) 6178, JPY1.2 billion; 13. Tokyo District Court, 27 July 2017, Heisei 27 (Wa) 22491, JPY1.07 billion; and 14. Tokyo District Court, 14 July 2022, Reiwa 1 (Wa) 17622, JPY1.01 billion. Even so, compared with damages awarded in the United States, the amounts awarded in Japan cannot yet be regarded as high. On the other hand, in Japan the requirements for obtaining permanent injunctions are generally understood to be less stringent than in the United States. When that is considered together with litigation costs, the duration of proceedings (the 2024 average was 14.5 months for district courts and 7.4 months for the Intellectual Property High Court for civil cases related to intellectual property in Japan – see the statistics published on the official website of the Japanese courts at www.courts.go.jp) and the recent trend toward higher damages awards, Japanese courts are likely to be considered more fre- quently than before as a forum for international patent disputes.
177 CHAMBERS.COM
Powered by FlippingBook