CHINA Trends and Developments Contributed by: Feng Zheng, Xiaoyang Yang, Baihe Liu and Hongfeng Li, Wanhuida Intellectual Property
this regard, the SPC found that the patentee and the patent implementer were equally liable for not reaching a licence agreement. In reaching this conclusion, the SPC examined the following factors in assessing the intent of the patentee to reach a licence agreement: • whether the patentee brought the litigation seeking royalty awarded without informing the patent implementer of the infringement in writing; • whether the patentee explicitly rejected the request of the patent implementer for a licence agreement; • whether the patentee directly proceeded or repeatedly threatened to sue the patent implementer for infringement or injunction during negotiation; • whether the patentee ceased negotiation without any reasonable cause; • whether the patentee disclosed to the patent implementer all necessary information about the SEP patent at issue; • whether the patentee refused to disclose to the patent implementer the basis or calcu- lation method for the proposed royalty or royalty rate; • whether the patentee offered no explanation as to why the proposed royalty for the patent implementer was obviously or substantially greater than its proposed royalty for the other competitors in the same field under the same circumstances; • whether the patentee timely responded to the patent implementer for its counter-offer within a reasonable time period; and • whether the patentee refused the request of the patent implementer for clarifying relevant technical questions.
In the meantime, the following factors were examined in scrutinising the intent of the patent implementer: • whether the patent implementer timely responded to the patentee’s written notifica- tion of infringement or informed the paten- tee of its unwillingness to negotiate within a reasonable time period; • whether the patent implementer actively responded to the patentee’s offer for a licence agreement within a reasonable time period; • where the patent implementer believed the patentee’s offer was unreasonable, whether the patent implementer actively provided a reasonable counter-offer or suggestions for the licence agreement, or whether the pat- ent implementer timely deposited the royalty proposed in its counter-offer; • whether the patent implementer postponed or ceased negotiation without any reasonable cause; and • whether the licence agreement proposed by the patent implementer was obviously unrea- sonable. For calculation of damages, the SPC held that the damages awarded to the patentee should include: • royalty the patent implementer should have paid; and • the patentee’s loss of interest the royalty should have yielded. The interest loss was calculated through multiplying royalty by interest rate for the overdue period of the royalty and liability percentage of the pat- ent implementer in culpa in contrahendo. To calculate the overdue period, the SPC found in general a licence agreement would be reached within 12–18 months, and it would take five additional days to process
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