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【Patent】Taiwan Patent Litigation – Invalidating a Patent After Court's Final Decision Is Too Late!

2024-01-11 Attorney An-Kuo Lai


In cases of patent infringement, accused infringers have the option to challenge the validity of a patent not only during civil litigation but also by filing a request for revocation with the Intellectual Property Office (TIPO). The dual system, where both the court and TIPO independently assess patent validity, inevitably opens the door to potential conflicting interpretations.
 
An awkward scenario arises when, in a final judgment, the court deems a patent valid and orders the defendant to pay damages. However, subsequently, TIPO revokes the same patent. In such a situation, can the accused infringer, who suffered an unfavorable judgment, initiate a retrial based on the revocation of the patent? In other words, can the accused infringer reclaim the compensation already paid?
 
In the past, the Intellectual Property Court held that accused infringers could not file a retrial based on patent revocation. Their reasoning stemmed from the fact that the Intellectual Property Case Adjudication Act granted the court the authority to independently judge the validity of a patent. Thus, the civil court conducted its own evidence investigation and determined the patent's validity, not relying on the administrative disposition of TIPO in granting the contested patent.
 
However, the Supreme Court took a different stance, asserting that patent rights are acquired through the effective administrative disposition granted by TIPO. If a court judgment affirms patent infringement and orders compensation, it is based on the infringement of patent rights. Therefore, if TIPO subsequently revokes the patent, the basis of the judgment has changed. According to patent law, once a patent is revoked, it is deemed never to have existed. Thus, the accused infringer has a valid reason to seek retrial under the Civil Procedure Code (Supreme Court Judgment No. 104 Tai-Shang-Zi 407).
 
To resolve this dispute, legislators explicitly stated in the amended Intellectual Property Case Adjudication Act (effective from August 30, 2023): when patent revocation dispositions are finalized, the parties shall not file a retrial suit pursuant to Civil Procedure Code for a finalized judgment in patent infringement cases. This explicitly denies accused infringers the right to initiate a retrial based on the revocation of the patent.
 
The reasons behind this amendment include:
1. When a court's final judgment in a patent infringement case affirms the validity of the patent, and later, the administrative disposition by the TIPO contradicts that judgment by denying the validity of the patent, requiring the patentee to return received compensation to the defendant, it undermines public trust in the validity and scope of patent rights.
2. The amended act introduces a mandatory lawyer representation system and enhances information exchange between the court and the TIPO, allowing the court to consult the opinion of the TIPO when determining the validity of intellectual property rights or rectifying the legal scope of patents. This helps prevent situations where the court and the TIPO differ in their judgments on the validity of patent rights and the scope of patents.
 
3.In order to preserve the stability of the conclusive judgment, facilitate a one-time resolution of disputes, and alleviate the litigation burden on both parties, it is imperative to restrict parties from filing a retrial suit under the Civil Procedure Code against the finalized judgment, even if subsequent administrative dispositions alter the validity of patent rights.
 
 
In summary, according to the amended Intellectual Property Case Adjudication Act, once the civil court issues a final judgment, the defendant, even if successful in revoking the patent, cannot change the judgment requiring payment of damages. Therefore, defendants should handle patent infringement litigation with greater caution. During the litigation, gather evidence supporting the revocation of the patent and submit it to the court or the TIPO before the final judgment, aiming to invalidate the patent before the court renders its final decision.