Shenzhen: Issue Guidebook to deal with “337 investigationâ€
The new Shenzhen Government Gazette published the Shenzhen Municipal Intellectual Property Office's “Shenzhen High-tech Enterprise Intellectual Property Protection Action Plan Work Plan†in the form of departmental documents, and also published a series of supporting documents, including guiding high-tech enterprises to deal with trade. The Guide to Friction (referred to as the US 337 survey).
The investigation is essentially an administrative remedy for the industry in accordance with Section 337 of the US Tariff Act of 1930. Since the competent authority, the US International Trade Commission (ITC), needs to investigate alleged unfair trade competition and make sanctions decisions based on the results of the investigation, it is customary to conduct a set of administrative investigations, trials, and sanctions under Section 337. Activities are collectively referred to as the 337 investigation.
The manual states that the legal basis, procedures and measures of the 337 investigation are summarized as follows:
One is a very low filing condition. According to Section 337, the request for investigation does not need to prove that the domestic industry in the United States has been damaged. As long as the plaintiff has registered registered intellectual property rights in the United States, regardless of whether the right holder is a national or a foreigner, it can file a 337 investigation with ITC. The application, even if the product in question itself has intellectual property rights in the exporting country, as long as it is not registered with the US intellectual property rights, it is in line with the filing conditions. Since the 337 investigation does not provide a mechanism for compensating for damages, there is no need to prove that the intellectual property rights in the United States have suffered actual damage or the extent of damage. Such low filing conditions have led to an increasing number of US intellectual property owners using 337 investigations to block imports of foreign products. In fact, it is not difficult to initiate the 337 investigation. Almost all the complaints were initiated by the committee after the submission.
Second, the legal risk is low. The result of the 337 investigation is that ITC judges whether the product involved is unfair or not. Even if it is determined that the respondent does not have infringement or unfair trade behavior, the plaintiff will not be required to bear any liability for compensation. Once ITC violates Section 337 on the products involved, it constitutes an unfair trade ruling. It is easy for the plaintiff to keep competitors out of the country and prevent their products from entering the US market. Even if the products have entered the US market, The ITC can be requested to issue a stop order that prevents these products from entering the sales channel or even conducting other business operations. Since the plaintiff can obtain very large returns of interest with very low legal risks, the 337 investigation is gradually becoming a trade protection barrier commonly used by American companies.
The third is a simple and quick trial procedure. Since most of the 337 investigations must be closed in less than 12 months, the patent litigation that appeals to the US federal courts generally takes several years to produce results. The 337 investigation is an effective means of excluding competitors. Enterprises favor. This fast pace is clearly beneficial to the prosecution because it can be used to prevent foreign competitors, US importers or distributors from continuing to sell foreign products in the United States as soon as possible. In contrast, this is extremely detrimental to the respondent because the respondent must meet the fact-finding requirements and make other substantive responses before a short deadline. Therefore, the Section 337 lawsuit has become a powerful legal tool for US companies to deal with foreign companies.
Fourth, the sanctions measures have a long effective period. 337 The permanent exclusion order in the investigation of sanctions is made for infringing products, so the exclusion order is always valid until the prerequisites for infringement of intellectual property rights disappear. Sometimes this effect may continue until the expiration of the intellectual property protection period. In other words, how long is the effectiveness of intellectual property, and how long the effectiveness of a permanent exclusion order can last.
The fifth is a wide range of attacks. The sanctions imposed by the 337 investigation are aimed at blocking the entry of products into the United States. Therefore, only products are not recognized. Since 337 has the power to issue a comprehensive exclusion order at the time of the ruling, that is to say, if the Chinese enterprise is absent or loses the case, the judge's ruling can completely ban all exports of certain types of products in China.
Sixth, the cost of responding to the law is high. The lawyer's fee of 337 investigation is usually several times or even dozens of times of anti-dumping, and it is generally difficult to estimate beforehand. The 337 investigation is actually a process of cross-examination between the prosecution and the defense. The more intense the confrontation, the more complicated the procedure and the higher the lawyer's expenses. Judging from the existing Chinese case, the responding fee is almost no less than one million dollars.
The manual points out the risks and coping strategies for reducing the 337 investigations: (1) Accelerating research and development, owning independent intellectual property rights, and eliminating dependence on foreign technology. (2) Make full use of laws and international conventions to protect their own intellectual property rights. On the one hand, it is necessary to apply for and register patents in China, and on the other hand, it attaches importance to the international protection of intellectual property rights. (3) Do a good job in market research and intellectual property search to avoid infringement of intellectual property rights of others. Before mass-produced products based on US patent technology, enterprises should carefully conduct market research and intellectual property search work, fully understand the registration and use of the intellectual property rights, and clarify the authority of intellectual property transferors to avoid involvement. Unnecessary intellectual property disputes.
At present, Chinese companies are increasingly encountering 337 investigations. The more famous ones are Cisco v. Huawei Inc. Not long ago, the US International Trade Commission (ITC) launched a 337 investigation on light-emitting diodes (LEDs). The four Chinese companies involved in the 337 investigation were all Guangdong enterprises, and three of them were Shenzhen enterprises. The 337 investigation is a trade friction involving intellectual property rights. Chinese enterprises should seek legal professional institutions and experts who are familiar with the intellectual property legal systems of China and the United States to seek help.
A guess: Does the US 337 investigate whether there is a conspiracy?
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