1. Introduction

In a patent infringement litigation, the plaintiff must prove that the defendant has infringed the patent right and the patent must be valid before the court enters the trial procedure for recognizing compensation for damages. Accordingly, the success rate for the patentee to obtain compensation is rarely low. The following are examples of a patentee successfully obtaining compensation (2017 Min Zhuan Su Zi, No. 43 by the Intellectual Property Court, 2018 Min Zhuan Shang Zi, No. 15 by the Intellectual Property Court and 2020 Tai Zhuan Zi, No. 1757 by the Supreme Court).

2. Facts

The plaintiff is the patentee of Taiwan utility model patent No. M441925 "Improved structure of power switch" (hereinafter referred to as the disputed patent), and the "XX brand automatic transfer switch (hereinafter referred to as the disputed product) sold by the defendant falls within the scope of claims 1 to 3 of the disputed patent. The plaintiff requested the defendant to stop infringing the disputed patent in a cease and desist letter in October 2015, but the defendant refused to respond. It is obvious that the defendant intentionally continued to sell the products despite being fully aware that there was a risk of infringing the patent rights of others, so the plaintiff requested compensation for damages in accordance with Paragraph 2, Article 97 of the Taiwan Patent Act.

3. Issues

(1) Does the disputed product fall within the scope of claims 1 to 3 of the disputed patent?

(2) Is the combination of evidence items 1 and 2 submitted by defendant sufficient to prove that claims 1 to 3 of the disputed patent are obviousness?

(3) Was the defendant’s infringement intentional or negligent?

(4) Are the claims in paragraphs 1 and 2 of the plaintiff's demand for litigation reasonable?

4. Summary of the judgments

(1) Main text of the judgment：The defendant shall pay the plaintiff NT$1,620,922 plus interest, and the defendant shall not make, offer for sale, sell, use, or import products which infringe the disputed patent for the aforementioned purposes or commit other acts that infringe the disputed patent.

(2) The court of the first instance determined that the disputed product infringes claims 1 to 3 of the disputed patent based on the doctrine of equivalents, and there is no technical connection between evidence items 1 and 2 submitted by the defendant, i.e., there is no motive for combination, whereby the evidence cannot prove that the disputed patent is obviousness. According to the information submitted by the plaintiff, it is proved that the defendant and the plaintiff operate in the same filed of business, whereby they should have a duty to ensure that their products do not infringe the patent of other companies. Moreover, the plaintiff had sent a cease and desist letter before it brought the litigation, which could prove the defendant’s negligence in infringing the disputed patent. Secondly, according to the uniform invoice submitted by the defendant and the tax information of the National Taxation Bureau, the total sales amounts of the disputed products were calculated, and the court determined the amount of compensation for damages was NT$1,620,922 after comprehensive consideration.

(3) The defendant filed an appeal against the first-instance judgment. Although the defendant submitted supplementary explanations to contend that the disputed product did not equivalently infringe the disputed patent, the court of the second instance did not adopt the grounds for appeal and still determined that the disputed product falls within the scope of claims 1 to 3 of the disputed patent based on the doctrine of equivalents. Furthermore, the appellant (the defendant in the first instance) argued that the disputed product had been exploited in the territory of the R.O.C. before the filing date of the disputed patent application. Therefore, the disputed product is exempted from the patent right of the disputed patent. The appellant also submitted additional evidence such as sales invoices, installation photos, design engineering drawings, the disputed product catalogs, advertisements, and notarial certificates. However, the above information could not persuade the judge so the prior use defense could not be established. Thus, the amount of the compensation for damages awarded in the first instance judgment was reaffirmed, and the appeal was dismissed.

(4) The appellant still filed an appeal against the judgment in the third instance, but eventually the Supreme Court dismissed this appeal. This dispute is finally settled and binding on the both parties. 

Reference: Anthology for the 70th Anniversary of Tai E's Law Practice