Posts in China

The Senate Judiciary Committee’s Subcommittee on Intellectual Property held a hearing today featuring a panel of patent-savvy witnesses to underscore the crucial role intellectual property plays in the U.S. economy and to define the biggest threats to IP rights, both foreign and domestic. The conclusion of most panelists as to what one step is most important in reestablishing the United States as an IP powerhouse was that we need to clean up our own IP system at home in order to even begin addressing threats from foreign competitors like China.

In commercial contracts, especially with foreign entities, it is very common to agree on arbitration as a dispute resolution method. A typical arbitration agreement specifies arbitrable matters, arbitration institution, place of arbitration, and arbitration rules. In crafting an arbitration agreement, especially when the arbitration clause is embedded in the main body, contracting parties normally write into the contract the applicable law and dispute resolution authority for the main contract, but rarely do the same for the arbitration agreement itself in addition to the main contract. In general, if a dispute involves issues surrounding the validity (or arbitrability) of an arbitration clause, whereas the arbitration agreement does not provide anything about arbitrability, two questions may come up in practice: (1) what is the applicable law on resolving the arbitrability issue? (2) who has jurisdiction over the arbitrability issue – a court or an arbitration institution?

U.S. companies and inventors still filed more patent applications with the European Patent Office (EPO) than any other country, according to its Patent Index 2022, which was released today. The index showed that U.S. patent applications numbered 48,088, a 2.9% increase from 2021. However, China’s filings jumped by 15.1% over 2021, keeping it in fourth place out of the top five countries of origin for applications and narrowing the gap between it and Japan, the number three filer.

Recently, ChatGPT (Generative Pre-trained Transformer), an artificial intelligence (AI) chatbot program developed by OpenAI, has become a popular topic, attracting much attention and discussion. Its applications in the fields of natural language processing and text analysis have been well documented and have aroused great interest. It can be used to generate various language models, such as natural language texts, dialogues, and question-answering. It is currently one of the most advanced and efficient technologies in the language field. ChatGPT has a wide range of applications. In fields like medical, financial, legal, and media, ChatGPT can also be used to generate and analyze text data, thereby improving work efficiency and accuracy. Recently, the technology has even been used in the realm of intellectual property, with some having used it to draft patent applications.

The U.S. House of Representatives’ Subcommittee on Courts, Intellectual Property and the Internet held a hearing Wednesday that was part one of a series it will be running on IP and “Strategic Competition with China.” On the same day, speakers on the final panel of IPWatchdog’s AI Masters discussed many of the same issues addressed in the hearing, with the overwhelming takeaway across both panels being that the United States needs a new plan when it comes to IP protection in cutting-edge technology sectors, where China is increasingly outpacing U.S. innovation. The House hearing was introduced by Subcommittee Chair Darrell Issa (R-CA), who explained that the United States’ national security is at risk because China is on a quest to achieve technological superiority. Issa told his colleagues that “the witnesses will both educate us, and to a certain extent, scare many of us.”

The Global Innovation Policy Center (GIPC) of the U.S. Chamber of Commerce issued its 11th annual International IP Index today, striking what seems like a more dismal tone than usual compared with past reports. While 18 economies saw modest progress on IP protection improvements, 28 economies, including many of the high-scorers, like the United States and the United Kingdom, had a 0% change in score. Only two countries had a 0% change in the 10th edition of the Index. The Index covers 55 economies that represent “most of the global economic output, together contributing over 90% of global GDP.”

On January 23, the Information Technology & Innovation Foundation (ITIF) published a report entitled Wake Up, America: China is Overtaking the United States in Innovation Output, which applies innovation and industrial performance metrics for comparing relative innovation outputs from foreign technological rivals China and the United States. The report, produced by ITIF’s Hamilton Center on Industrial Strategy, is the latest indicator that China is close to surpassing the United States in terms of innovation output per capita and calls upon U.S. policymakers to develop a national economic and technology policy to restore U.S. dominance in innovation.

Worldwide IP filings increased by 3.6% in 2021, according to a report published November 21 by the World Intellectual Property Organization (WIPO). The increase came during a turbulent time for the world economy, at the height of the COVID-19 pandemic, as well as a global economic downturn. The biggest increase in patent filings was in Asia, where 67.6% of worldwide patent applications were filed. The United States saw a 1.2% decrease in filings and a 1% increase in trademark filings. Trademark applications grew at a much faster rate than patent applications, with a 5.5% in trademark filing activity. Industrial design filing activity also rose by 9.2% with the largest uptick again in Asia. China saw high rates of growth and is a global leader in sheer numbers across all indicators.

The China National Intellectual Property Administration (CNIPA) released a draft of new measures that would downgrade the ratings of Chinese patent agencies that approve abnormal or fraudulent patents. CNIPA released the draft on October 8, which expands on a trial started in January 2022 in four provinces. The draft sets out to “crack down on illegal and untrustworthy acts” carried out by Chinese patent agencies and promote a healthier development of Chinese intellectual property.

During the final day of IPWatchdog LIVE in Dallas, Texas on Tuesday, a panel of attorneys discussed issues surrounding “dangerous fakes,” which are counterfeit goods that pose health risks to consumers. The panelists began with a brief overview of how U.S. Customs and Border Protection (CBP) identifies and seizes infringing goods. The panel also outlined the role that U.S. Consumer Product Safety Commission (CPSC) plays in working to identify dangerous fakes in conjunction with CBP.

The U.S. Court of Appeals for the Third Circuit on Monday said in a precedential decision that Jiangsu Tie Mao Glass Co. Ltd. (TMG) should have shown up sooner in a trade secrets misappropriation lawsuit brought against it by PPG Industries if it wanted to have a chance at winning. But by failing to enter the litigation until after PPG asked the district court to enter default judgment and award damages for unjust enrichment, “its protestations were and are too little and much too late,” said the appellate court.

As the concept of a unified “metaverse” is gaining traction, savvy brand owners are shifting their focus to securing rights in this emerging sector. In pursuit of intellectual property (IP) rights, individuals and corporations are turning to metaverse trademark filings to provide protection for goods and services in the virtual world. As of the summer of 2022, the China National Intellectual Property Administration (CNIPA) has received more than 16,000 applications that either contain the word “METAVERSE” (in English or its Chinese translation: “YUAN YUZHOU,” or both) or that include descriptions of goods and services in the virtual world, or both. These applications were filed by individuals as well as companies (big and small, both foreign and domestic). The rejection rate for traditional trademark applications in China is typically high, around 60-70%, at least in the first instance. However, the rejection rate for these new metaverse applications is even higher, hovering around 80%.

On August 9, President Joe Biden signed into law the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, enacting a major legislative package that will provide $280 billion in federal funding to encourage the domestic production of semiconductor products in the United States as well as fund research and development projects in advanced technological fields like quantum computing and artificial intelligence. Although the 1,000+ page bill establishes massive investments into several areas of developing technologies, it focuses very little on the intellectual property rights that are critical for protecting the new technologies that would be developed through federally funded projects.

An “NNN” agreement is short for Non-Disclosure/Non-Use/Non-Circumvention agreement, which means the information cannot be shared with anyone, it cannot be used in any way, and “behind-the-back” or design around tactics are forbidden. In recent years, signing NNN agreements has become widely adopted and is now the standard initial step in dealings with Chinese companies, particularly original equipment manufacturers (OEMs). An NNN Agreement is much more than just a Non-Disclosure Agreement (NDA). An NDA focuses narrowly on preventing secret information from being revealed to a third party or to the public, which is not sufficient for OEMs in China. In contrast, an NNN agreement not only contains confidentiality provisions, but also prevents misuse of confidential information.