MACAU SAR, CHINA Trends and Developments Contributed by: João Nuno Riquito, Bruno Almeida and Daniel de Senna Fernandes, Riquito Advogados
The plaintiffs sought to obtain severe remedies, including injunctions, the removal of equipment, con- tract terminations, significant damages of USD15,000 per betting terminal, and public disclosures of the infringement. Resolution finally came about when the Macau Court of First Instance delivered its ruling on these pro- ceedings, according to which the focus shifted from infringement to the fundamental validity of the under- lying intellectual property rights. In accordance with Section 104 (3) of the RJPI, a patent’s validity is not presumed merely because it has been granted and titled. Moreover, Section 104 (1) of the RJPI provides that a patent holder may exercise the rights conferred by the patent only when the patent is, in fact, valid. In these proceedings, the Court of First Instance did not restrict its purview to merely assessing the alleged infringement; rather, it had to first reassess the validity of the patents, recognising that under Sections 104 (1) and 104 (3) the existence of a valid patent is a pre- requisite to any relief being granted to the plaintiffs. Consequently, the court examined the patents’ validity first, before addressing the substantive infringement claims. In short, the court dismissed all of the plaintiffs’ claims and upheld the defendants’ counter‑claim that the patents failed to satisfy the legal requirements for protection and therefore, despite having been granted by DSEDT, the patents were not valid. It declared two of the plaintiffs’ patents “null and void”, ordered the cancellation of those registrations and required the plaintiffs to pay all legal costs. The Court’s reasoning for these declarations hinged on the determination that the inventions did not meet the requirement of inventive step, finding that a pro- fessional in the sector could logically deduce the alleged innovative effect from the prior art. By estab- lishing that the inventions lacked the requisite inven- tive step as defined under Section 61 of the RJPI, the Court deemed the patents null and void ab initio, consequently concluding that the patents were not susceptible to protection under Section 47 (a) of the RJPI, which states that IP rights are totally or partially null and void when the object is found to be to not susceptible protection.
Although the plaintiffs have announced their intention to appeal the ruling, the judgement effectively repre- sents a stepping-stone for the defendants and with a significance that arguably extends beyond the imme- diate parties. Immediate market impact The gaming industry is the major engine sustaining Macau’s economy, but its success rests on an under- lying framework that demands strict adherence to the rules governing market conduct – such as fair-play, equitable operating standards and full compliance with IP rights. Market players are likely to view this ruling with great appreciation, as it signals that the market works and that Macau is a credible jurisdiction, hence all rem- edies available are to be used and tested with the authorities and the courts. For every competitor in the gaming technology sector, a counter-claim challenging a patent’s validity (and effectively attacking the very foundation of the IP own- er’s asserted right) constitutes a legitimate defensive strategy in infringement proceedings, as the courts may be willing to look beyond the mere fact of reg- istration and proceed with a thorough, technical re- examination of the patentability requirements, thereby offering a robust safeguard against registered patents that may lack the essential elements of novelty or an inventive step. In other words, merely registering an IP right may not guarantee its legal validity or commercial enforceability. While it’s true that in Macau, firms must submit patent applications that fully satisfy the substantive novelty and inventive-step requirements set out in the RJPI, this ruling serves as a stark reminder that a success- ful administrative filing is insufficient if the invention cannot survive a judicial test of inventiveness. There- fore, any company contemplating licensing, merger or acquisition deals involving Macau‑registered IP must elevate its due‑diligence standards, scrutinising not only the existence of a patent but also the robustness of its underlying legal merits. Financial valuations and strategic decisions therefore need to factor in the risk that an ostensibly granted IP asset could be rendered null by a court action.
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