BiotechChinaCourt CasesCourtsPatent LawPharma
16 June 2022

What Kind of Damage Awards Can You Get in China?

Is it worth filing for a patent in China? What kind of damage awards can you get?

Pharma companies care more about injunction than damage awards, since it’s quite unlikely that any damage award can compensate for the large amounts of money that may be lost for patent infringement. Chinese courts often issue injunctions in pharma patent litigations (both by the court and administrative enforcement bureaus), though damage awards are possible too.

Although not all court cases are publicly available, there have been some recent published cases with pretty high damage awards, ranging from $750K USD to $25M USD. Keep in mind these are cases litigated under the old patent law, where punitive damages did not exist. Going forward, as punitive damages of up to five times are now part of the new patent law, future damage awards are likely to be even higher.

Uncooperative Defendants? Patentees Can Provide Evidence of Profits

In 2021, the Supreme People’s Court (SPC) awarded a $20 Million RMB ($3 Million USD) damage amount to a Swiss medical device company Synthes GmbH for patent infringement by a Chinese medical device company. The patent related to a medical device for treating femoral fractures which consisted of “a main nail” and “a bone fixation element.”

This particular case is interesting because the Court calculated the damage amount by relying on the patentee’s reasonable assessment of the profits, using evidence such as the infringer’s prospectus reporting the company’s annual operating profits. The court determined that the defendant did not adequately disclose its true profits (e.g., they claimed most of the receipts were “lost” or “missing”). Accordingly, the final assessed profits were based on information provided by the patentee, resulting in this very large $3 Million USD damage award.

Largest Damage Award 2021

The largest damage award of 2021 that we found based on publicly available records was $167 Million RMB ($25M USD), for infringement of a patent originally filed by Toshiba (sold to Oaks Engineering) for an air conditioning compressor. In October 2021, the Intermediate Court ruled that the defendant’s prior art defense was not valid, and proceeded to award a $167M RMB damage award to the plaintiff (Oaks) for patent infringement. The defendant may appeal, so this case is still not over yet.

Pharmaceutical Cases

A recent life science case from 2021 involving a patent covering a fermentation process for synthesizing dibasic acids had a $5 Million RMB award. In general, most successful pharmaceutical cases result in permanent injunctions.

Willful Damages

Willful damages were just added to the patent law in June 2021, and thus the number of judgments will inevitably be lower than in a typical full year. We have not yet found any published cases, though official Chinese Court communications indicate that in 2021 courts across China handled 642,968 IP cases, and awarded punitive damages in 895 cases (0.13% of cases).

About the Authors

Jennifer Che, J.D. is Vice President and Principal at Eagle IP, a Boutique Patent Firm with offices in Hong Kong, Shenzhen, and Macau.

Yolanda Wang is a Principal, Chinese Patent Attorney, and Chinese Patent Litigator at Eagle IP, a Boutique Patent Firm with offices in Hong Kong, Shenzhen, and Macau.

This article is for general informational purposes only and should not be considered legal advice or a legal opinion on a specific set of facts.

Other Articles

China Divisional Practice

17 June 2019
China allows the filing of divisional applications but under specific circumstances. Most importantly, divisional applications can usually only be filed voluntarily during the prosecution of the original parent application. Once the parent application is granted or withdrawn, no additional voluntary divisional applications may be filed. However, divisionals can be filed to pursue subject matter not […]

US vs CN: Foreign Filing License Requirements

9 November 2022
In China, foreign filing requirements are generally very similar to the US — a foreign filing license is required if a foreign application is to be filed first for an invention made in the country. The Chinese equivalent to the US foreign filing license is called a confidentiality examination for foreign filing. According to Chinese […]

Everything you need to know about Patent Term Adjustment (PTA) in China

7 May 2024
We previously discussed patent term compensation for patent office delay (‘Patent Term Adjustment’ or ‘PTA’) when such new system was introduced in the Fourth Amendment of the Chinese Patent Law (2020), as well as in the different versions of the Draft Examination Guidelines released in 2021 and 2022. In this article, we consolidate everything you need to […]

Breaking News: China passes Fourth Amendment to the Chinese Patent Law

19 October 2020
After 12 years, the Fourth Amendment to the Chinese Patent Law has passed and will be in effect on 1 Jun 2021. After years of multiple draft amendments that moved in various directions, we FINALLY have some clarity on what patent protection is going to look like in China in the coming future. Many of […]

Our Past Events

Top crossarrow-right