I OVERVIEW

According to the Department of Statistics of the Taiwan Judicial Yuan, details of civil cases decided through the first instance of the Intellectual Property Court (IP Court) are as follows:

    1. 2014: 111 patent civil cases. Of these, 81 cases were either withdrawn or dismissed, and 30 cases (27 per cent) were won, partly won and partly dismissed, settled or mediated.
    2. 2015: 113 patent civil cases. Of these, 86 cases were either withdrawn or dismissed, and 27 cases (23.9 per cent) were won, partly won and partly dismissed, settled or mediated.
    3. 2016: 100 patent civil cases. Of these, 72 cases were either withdrawn or dismissed, and 28 cases (28 per cent) were won, partly won and partly dismissed, settled or mediated.
    4. 2017: 107 patent civil cases. Of these, 78 cases were either withdrawn or dismissed, and 29 cases (27 per cent) were won, partly won and partly dismissed, settled or mediated.

It can be inferred from the above statistics that although the rate of unfavourable results for patent civil cases is still high, it is slightly dropping – this might show that the IP Court has become friendlier to patent rights owners

The IP Court has begun to make some internal reforms regarding case judgments because it received a lot of complaints about the success rate for plaintiffs in patent infringement litigation being too low (i.e., in the range of 10–20 per cent). One of the most notable changes is that the percentage holding that a patent was deemed as invalid was reduced from 60 per cent to 30 per cent.2 This is good news for patentees because this will give them more of a chance to win a civil lawsuit and be awarded damages.

In addition, in 2016, the Taiwan Intellectual Property Office (TIPO) published the Guidelines for Identifying Patent Infringement (New Guidelines), and the New Guidelines had some remarkable changes from the previous guidelines (Old Guidelines). The changes include eliminating the 'reverse doctrine of equivalents' standard and more broadly interpreting a product claim limited by use, and both of these two standard changes seem to be more favourable to the patent rights owner. From this perspective, the patent infringement practice described in the New Guidelines appears to enhance the protection aspects of patent rights. Therefore, it is believed that Taiwan will become a jurisdiction that is much friendlier to the patent owner than before.

II TYPES OF PATENT

Types of patent include invention patents, utility model patents and design patents. An invention patent covers exclusive rights to inventions based on technical ideas using natural laws. A utility model patent covers exclusive rights for devices based on technical ideas using natural laws, in connection with the creation of a shape, structure or combination of both. A design patent covers exclusive rights for a shape, pattern, colour or combination of these, for an aesthetic item.

The durations of rights granted to an invention, utility model and design patent are respectively 20 years, 10 years and 12 years from the date of actual filing rather than the priority date.

All patents should be filed at the TIPO for examination or registration. Invention and design patents are required to go through substantive examination by the TIPO to ensure that they meet legal requirements regarding statutory subject matter, enablement, written description, industrial applicability, novelty, non-obviousness and unity. However, utility model patents are only required to go through formal examination, where enablement, industrial applicability, novelty and non-obviousness are generally not examined.

Where regulatory approval is obtained in accordance with applicable laws and regulations for the exploitation of an invention patent involving a pharmaceutical or agrichemical, or the manufacturing process thereof, if such regulatory approval is obtained after publication of the invention patent, the patentee may apply for one and only one extension of the patent term of said invention patent based on the first regulatory approval. The regulatory approval is allowed to be used only once for seeking patent term extension, and the granted patent term extension is five years at most.

III PROCEDURE IN PATENT ENFORCEMENT AND INVALIDITY ACTIONS

Disputes or contentions of infringement on patent rights can be brought to the district court located in the district where the defendant resides, where the infringing acts occurred. Or they can be directly brought to the IP Court, which was established to specialise in resolving IP-related disputes.

The invalidation proceedings should first be brought to the TIPO, which is the exclusive administrative authority before a case enters into the judicial remedy system. If a defendant in a civil proceeding for patent infringement would not like to initiate the lengthy invalidation proceedings through the TIPO, he or she may just raise the issue of the invalidity as a defence in the civil proceedings. The judges' decision on the issue of the invalidity, however, will not have res judicata; that is, the patent is still valid even though the judges hold the patent at issue invalid in the civil proceedings. However, the judged invalidity issue may still have an effect of issue preclusion for other cases involving the same parties.

Although any party can institute the invalidity claim before TIPO, only the patentee or the exclusive licensee has a standing to bring an infringement claim to prevent or exclude others from exploiting the invention, utility model or design patent.

As to limitation periods, the right to claim patent infringement becomes extinguished if not exercised within two years after the patentee has become aware of the damage and the person liable for damages. The rights to claim also become extinguished if they are not exercised within 10 years after the time of infringement.

While anyone may bring an invalidity claim before the TIPO, if the ground of the invalidation is that the patentee is not the owner of rights to apply for the patent, an invalidity claim can only be filed by the interested party. In addition, there is no specific limitation period for bringing an invalidity claim.

The proceedings of the patent infringement start after the plaintiff submits a complaint to the court. When the defendant receives the complaint, he or she can submit counter briefs to the court. The court generally will assign one judge (or a commissioned judge in the second instance) to conduct the preparatory proceedings for clarifying the implications involved in the action or in some specific circumstances, and conduct early evidence collection and investigation. After these procedures, the evidence investigation and oral argument proceedings start when the evidence may be obtained from examination of witnesses, expert testimony, documentary evidence, document inspection, interrogation of interested parties, etc. Finally, at the appropriate decision-making time, the court will render the judgment.

Where it is likely that evidence may be destroyed or its deposition in court may be difficult, or where consent has been received from the opposing party, a party may move the court for preservation of such evidence. Where no action has been initiated, a motion for preservation of evidence shall be made to the court where the action is to be brought. When the action has been initiated, such motion shall be made to the court where the action is pending. The court may inspect, examine or preserve documentary evidence when preservation of evidence is ordered. The level of proof is preponderance of evidence standard. There is no strict discovery proceedings here, as in the applicable US laws. Neither is there similar saisie contrefaçon under the French laws here, as the criminal provisions were abolished in 2003.

The invalidation proceedings start when the opponent files a petition before the TIPO. When the patentee receives the relevant documents, he or she may submit arguments to the TIPO. There are generally no oral argument proceedings in the invalidation proceedings, and the TIPO will examine ex officio the case on the basis of the written arguments submitted by two parties. When the time for decision discretionarily arrives, the TIPO will render a decision.

The amendments of a patent may be made during the patent invalidity proceedings as long as it is pending before the TIPO. The patent can only be amended:

    1. to delete claims;
    2. to narrow down the scope of the claim;
    3. to correct errors or translation errors; or
    4. to clarify ambiguous statements.

A defendant may challenge validity as a defence in infringement proceedings. The invalidity challenges generally cannot stay the proceedings for infringement. Therefore, if the judge holds that the patent has not been infringed in any way and the action is thus mature for decision, the court may render a judgment dismissing the plaintiff's claims because of non-infringement, leaving the issue of invalidity unaddressed because it does not affect the results of judgment. Similarly, if the judge holds that the patent is invalid and the action is thus mature for decision, the court may render a judgment dismissing the plaintiff's claims because of the invalidity without making any mention of the issue of infringement.

In general, a patent infringement case will take six to 12 months for each instance, and its cost may be around NT$300,000 for an average case.

Patent invalidity proceedings before the TIPO may take one to two years. If, however, the patent invalidity proceedings are derived from the patent infringement proceedings, it will take much longer because the TIPO tends to intentionally, though not necessarily, wait and make their decision after the patent infringement proceedings irrevocably end. The initial cost for the proceedings before the TIPO may be around NT$100,000 for an average case.

The plaintiff can move for an injunction maintaining the temporary status quo before the infringement proceedings. The plaintiff shall explain why it is necessary to prevent material harm or imminent danger or other similar circumstances through such motion. The practical standards may be understood as those implemented in the United States – in other words:

    1. that there is a likelihood of irreparable harm with no adequate remedy at law;
    2. that the balance of harm favours the movant;
    3. that there is a likelihood of success on the merits of the case; and
    4. that public interest favours the granting of the injunction.

The court dismisses the motion if the explanation is insufficient. In addition, even when the grounds of motion for an injunction maintaining the temporary status quo are sufficient, the court may still order the applicant to provide a security for granting the injunction.

Although no specialised term is used for 'protective letter' in this jurisdiction, such a letter is theoretically possible because it has the nature of a provisional measure. Furthermore, a declaratory judgment for declaring a patent is invalid is justified. In addition, under current practices, before an injunction maintaining the temporary status quo is granted, the court shall accord all parties an opportunity to appear in the hearing.

When the court later revokes an injunction maintaining the temporary status quo because such order is not justified ab initio, or such revocation is moved by the creditor, or a regular action is not initiated within the court-specified time period, the movant of the injunction shall indemnify losses suffered by the opposing party.

According to Article 45 of Taiwan Fair Trade Act, 'no provision of this Act shall apply to any proper conduct in connection with the exercise of rights pursuant to the provisions of the…Patent Act.' This rule is further addressed in Judicial Yuan Interpretation No. 548 by Justices of the Constitutional Court. This Judicial Yuan Interpretation opines that the proper conduct in connection with the exercise of rights includes:

    1. if the rights owner has obtained the court's first-instance decision or identification report from a fair and objective appraisal body, and notified the manufacturers in advance that the owner's rights appear infringed when the rights owner disseminates a warning letter of infringement; and
    2. a warning letter is disseminated without attaching the above-mentioned court's decision or identification report, but the rights owner faithfully describes specific contents and scopes of the rights and specific facts of the infringement, and does not violate prohibition provisions of the Fair Trade Act.

That is, it is a fundamental principle that although the patent law grants the patent rights owner the rights to exclude and prevent infringement by others, the rights may not be abused. If the rights owner violates this fundamental principle, he or she is not worth protection and may be charged under the Fair Trade Act.

IV SUBSTANTIVE LAW

i Infringement

For a product invention, utility model or design patent, an exploiting act means the act of making, offering for sale, selling, using or importing that product for the aforementioned purposes. For a process invention patent, an exploiting act means:

    1. using the process; or
    2. using, offering for sale, selling or importing for the aforementioned purposes the product obtained directly by that process.

The exclusive patent rights are only enforceable within Taiwan's jurisdiction, and no extraterritorial jurisdiction is, therefore, available.

Where there is a person who has not yet committed an actual infringement but has completed preparatory acts for infringement, the patentee may petition to prevent the person from the acts of patent infringement in order to strengthen the protection of the patent rights. For example, if the person has purchased the machine and raw materials, and has prepared to manufacture and sell products embodying the patented invention, these preparatory acts are likely to eventually infringe the patent rights. Under these circumstances, the patentee does not have to wait for the actual infringement before requesting the infringer to remove the infringement, and the patentee may petition to stop or prevent the preparatory acts from maturing into the occurrence of eventual actual infringement as long as he or she demonstrates the possibility of infringement.

In Taiwan, the Patent Act does not specifically provide joint liability, so the application of joint liability should be supplemented by Civil Code and judicial precedents. Paragraph 1 of Article 185 of Taiwan Civil Code stipulates: '[i]f several persons have wrongfully damaged the rights of another jointly, they are jointly liable for the damages arising therefrom'. In addition, one of the most common acts of joint infringement is the joint tort act, and there are basically three requirements to establish the joint tort:

    1. there are multiple actors (not all of the actors needs personally implement the tort act). For example, if several persons collude together and implement the tort act by a part of them, the person who takes or recognises the others' acts as his or her own act is also an actor;
    2. every actor needs to meet the requirements of general infringement acts; and
    3. a connection of intent is not required among the actors – only jointly associated acts are required. 'Jointly associated acts' means that any of the actors' negligent acts is a common cause of the damage.

Directors of infringing companies may normally be held liable for infringement under Paragraph 1 of Article 185 of the Taiwan Civil Code, or similar rules related to vicarious infringements, such as Article 188 of the Taiwan Civil Code and Article 23 of the Taiwan Company Act.

The application of the divided infringement under Paragraph 1 of Article 185 of the Taiwan Civil Code is much more uncertain. In a Supreme Court case of 1989 in Taiwan, the Court held that, within the purpose of joint infringement, the tort implementers sharing in a part of the infringement act and mutually taking advantages of the others' acts to achieve the purpose are also joint infringement actors and are jointly liable for the damages arising therefrom. Therefore, it seems that divided infringement where each tort implementer performs a portion of steps to complete an infringement act may be applied in general civil law regime in Taiwan. Common purpose or direct or control relationships between the actors may be required to prove divided infringement.

Foreign suppliers or accessories may be held liable for infringement under Paragraph 2 of Article 185 of the Taiwan Civil Code, which provides that instigators and accomplices are deemed to be joint tortfeasors. In addition, the court's decision usually holds that instigators' or accomplices' knowledge of the infringement is required for them to be liable.

The scope of a patented invention shall be determined by the claim, and descriptions and drawings may be considered as a reference, but not a limitation, when interpreting the claim. Claims should be interpreted in a reasonable, rather than the broadest, way. The intrinsic evidence (e.g., specification, claims, drawings and file wrapper, and relevant or corresponding cases) and extrinsic evidence (e.g., professional dictionaries, reference books, textbooks, encyclopaedias and expert testimonies) may be used as a reference to interpret the claims and the order as intrinsic evidence is applied prior to extrinsic evidence.

The all elements rule must be satisfied when applying either literal infringement or doctrine of equivalents, where the element does not necessarily mean the physical element but the technical feature of the claim. When an accused product or process was literally read on a claim, it is literally infringing on the claim. When the accused product or process was not literally read on a claim but was substantially identical to the claimed invention in aspects of their ways, functions, and results, it still constitutes infringement under the doctrine of equivalents. There are, however, some limitations against the doctrine of equivalents, such as the prosecution history estoppel, prior art defence and donation principle.

A prior arts defence means that when determining whether or not to apply the doctrine of equivalents, if all the technical features of the accused object are the same as a previous single prior art, or a simple combination of a single prior art and the common knowledge of the technical field at the time of filing, then the doctrine of equivalents is not applicable and the accused object does not constitute infringement.

The donation principle means that if a technical feature is disclosed in the specification or drawings of the patent at issue, but is not covered or recited in the claims, the technical feature shall be construed as a contribution to the public, and the patentee cannot claim the doctrine of equivalents on the technical feature that he or she could have claimed but did not claim during the prosecution.

ii Invalidity and other defences

At the very least, the bases for bringing an invalidity claim include violation of one of the following legal requirements for a patent:

    1. statutory subject matter;
    2. an invention or design should not be:
      • animals, plants, or essential biological processes for the production of animals or plants, except for processes for producing microorganisms;
      • diagnostic, therapeutic or surgical methods for treatment of humans or animals; or
      • inventions or designs contrary to public order or morality;
    3. the enablement requirement;
    4. the written description requirement;
    5. industrial applicability;
    6. novelty;
    7. non-obviousness;
    8. the first-to-file principle;
    9. the double patenting bar;
    10. the invention or design extending beyond disclosure of the original application; and
    11. the applicant being not entitled to file the patent application.

There is no best mode or method requirement.

Defences to infringement claims include:

    1. non-infringement;
    2. acts done privately and for non-commercial purposes;
    3. international exhaustion of owner's rights;
    4. an expired limitation (where the right to prevent and exclude infringement will become extinguished if not exercised within two years after the patentee has become aware of the damage and the person liable for damages, or become extinguished if it is not exercised within 10 years after the acts of infringement);
    5. licence;
    6. upon suing an instigator or accomplice under Paragraph 2 of Article 185 of the Taiwan Civil Code, lack of instigator's or accomplice's knowledge; and
    7. upon suing divided infringer under Paragraph 1 of Article 185 of the Taiwan Civil Code, lack of common purpose or direct or control relationship between the actors of the divided infringement.
    8. necessary acts to exploit the invention for research or experimental purposes;
    9. right of prior use. However, this rule does not apply if the person has known about the invention from the patent applicant for less than 12 months and the patent applicant has made a statement reserving his or her right to a patent being granted;
    10. a vehicle merely passing through the territory of this country, or any device of such vehicle;

V FINAL REMEDIES FOR INFRINGEMENT

A patentee may demand that a person who infringes or is likely to infringe their patent rights must stop or prevent such infringement from happening. When making such a demand, the patentee may request the destruction of infringing articles or materials or implements used in the infringing act, or request another necessary disposal. If patent infringement occurs as a result of intentional act or negligence, the patentee may claim for damages suffered therefrom.

The damages claimed may be calculated according to any of the following methods:

    1. damages suffered and lost profits;
    2. if no method of proof can be produced to prove suffered damages, a patentee may claim damages based on the difference between the profit earned through patent exploitation after infringement and the profit normally expected through exploitation of the same patent;
    3. the profit earned by the infringer as a result of patent infringement; or
    4. the amount calculated on the basis of reasonable royalties that may be collected from exploiting the patent being licensed.

In addition, where the infringement is found to be intentionally committed, the court may, upon request and on the basis of the severity of the infringement, award damages greater than the loss suffered but not exceeding three times the proven loss.

The plaintiff can move for an injunction maintaining the temporary status quo (preliminary injunction) before or in the regular infringement proceedings. In addition, once the plaintiff prevails in the motion for the preliminary injunction, the injunction will become effective until the injunction is revoked by the appeal court during an interlocutory appeal protesting the ruling for the motion. After trial on all issues, normally in or with the decision rendered by the court and favourable to the plaintiff, the court makes the final injunction. The easiness of obtaining a final injunction depends on the its necessity to justify the case situation. If such necessity is affirmed, the court decision is always accompanied by a final injunction. Upon making the final injunction, however, the court will ease its own burden of such decision by requiring the plaintiff's deposit of a bond generally equivalent to one third of the economic or assessed value of the claim, while allowing the lifting of such final injunction with submission of the defendant's bond equivalent to the full economic or assessed claim value. The preliminary injunction may be stayed by the same court under the doctrine of change of circumstances through submission of relevant evidence from both parties, while the final injunction may be stayed by a higher court also under the doctrine of change of circumstances. In practice, when stayed, it is possible to appeal the injunction just like one does for the regular court decision. The effective scope of any injunction is commensurate with what is described therein, which in turn depends on what the judge finds in the case. The preliminary injunction is good until there is a final injunction or a court decision ruling its removal, while the final injunction is binding until the cause therein disappears or it is removed by a higher court.

VI OTHER TYPES OF PATENT PROCEEDING

A declaratory proceeding before the court for declaring non-infringement is possible. It is an action normally instituted by a possibly alleged infringer. For a patent matter, the IP Court may be the tribunal selected by the relevant party. Criminal provisions in the Patent Act were abolished in 2003.

In response to national emergency or other circumstances of extreme urgency, the TIPO shall, in accordance with an emergency order or upon notice from the central government authorities in charge of the business, grant compulsory licensing of a patent that is required, and notify the patentee as soon as reasonably practicable. In addition, the TIPO may, upon request, grant compulsory licensing of a patent under any of the following circumstances for which it is deemed necessary:

    1. where a patented invention is to be exploited non-commercially for the enhancement of public interest;
    2. where a later invention or utility model patent cannot be exploited without infringing upon a prior invention or utility model patent, and where the later invention or utility model patent involves an important technical advancement of considerable economic significance in relation to the prior invention or utility model patent; or
    3. where a patentee has committed acts restricting competition or has committed unfair competition acts, for which a judgment has been made by a court of law or a decision has been rendered by the Fair Trade Commission of the Executive Yuan.

Request for compulsory licensing of a patent involving semiconductor technology shall be filed based on the grounds set forth in item (a) or (c) above. Request for compulsory licensing of a patent made pursuant to item (a) or (b) may only be approved if the requestor has made efforts to obtain authorisation from the rights holder on reasonable commercial terms and conditions, and that such efforts have not been successful within a reasonable time period. Where a request for compulsory licensing of a patent is made pursuant to item (b), the owner of the prior patent may propose reasonable terms and conditions and seek grant of compulsory licensing of the later patent owned by the requestor.

An interested party may initiate an invalidation proceeding before the TIPO when the patentee is not the owner of rights, to apply for a patent.

A patentee may request that the Customs Office detain the imported articles that are suspected of infringing the patent right or rights. The request should be made in writing, accompanied by a prima facie showing of facts of infringement and a security amounting to the duty-paid price of the imported articles, as assessed by Customs, or its equivalent collateral. Customs shall immediately notify the detention requester upon its acceptance, and shall notify in writing both the detention requester and the owner of detained articles when executing the detention. By providing a security amounting to two times of the security or its equivalent collateral, the owner of detained articles may request that Customs lift the detention.

Customs shall repeal the detention for any of the following reasons:

    1. Customs has not been notified by the detention requester, within 12 days of the date of Customs' acceptance of the request, that a litigation claiming that the detained articles infringe patent rights has been initiated;
    2. a litigation initiated by the detention requester claiming that the detained articles infringe the patent rights has been dismissed by a final and binding court judgment;
    3. a court of law, in a final and binding judgment, has held that the detained articles do not infringe patent rights;
    4. the detention requester has requested the repeal of detention; or
    5. the owner of the detained articles has shown to the satisfaction of Customs that they should lift the detention.

VII APPEAL

Disputes or contentions of infringement on patent rights may generally be resolved in the IP Court and Supreme Court. There are three instances, two of which are in the IP Court, and a final instance in the Supreme Court.

The appeal rate is relatively high in Taiwan. This is mainly because the attorney fees for litigation payable by local clients are relatively low, so each party is typically willing to exhaust the appeal proceedings to pursue any possibility of obtaining a more satisfactory decision. If a party decides to appeal the decision of the first instance, it shall be made within 20 days of service of the first instance decision. The judges of the second instance try not only legal issues but also factual issues, such as those facts that were not clarified or correctly presented because of the law violation of the first instance or other proper cause, the fact that occurs following the end of the oral arguments, the fact that shall be investigated ex officio by the court, etc. Accordingly, new evidence may be adduced in the second instance. As long as a decisive legal issue or factual issue exists that was not properly tried in the first instance, the likelihood of overturning a decision is appealing. Although the laws require that any decisive legal or factual issue must be debated in the oral proceedings, written briefs or documents play a critical role. As mentioned above, each instance may have a time frame spanning from six months to one year, while it may cost around NT$300,000 for an average case in either infringement or invalidity proceedings.

If the party decides to appeal the decision of the second instance to the third instance, it should appeal within 20 days after service of the second instance decision. For infringement cases, this may be possible only if the petitioner's interests are no less than NT$1.65 million. The judges of the third instance may try only legal issues, so the grounds for appeal shall be based on arguments regarding how the decision of the second instance violates the laws. For example, the grounds might demonstrate that the decision fails to apply or improperly applies any applicable law, that the original decision fails to comply with statutory procedures, or that the decision was not reasonable or was arrived at through contradictory reasons.

The invalidation proceedings should be made to the TIPO first. The appeal process may be summarised as follows. The applicant shall first appeal the unsatisfied examination decision to the Petitions and Appeals Committee (PAC). If the applicant is not satisfied with the PAC's decision again, it may further appeal to the IP Court. There are two possible outcomes in the IP Court. If the applicant is not satisfied with the IP Court's decision, it may further appeal to the Supreme Administrative Court to pursue a final decision.

VIII THE YEAR IN REVIEW

On 29 June 2017, an appeal tribunal of the IP Court handed down a Civil-Patent-Appeal No. 24, 2016 judgment on the Koninklijke Philips NV v. Gigastorage Corporation case. In the preceding Civil-Patent-Sue No. 38, 2014 instance, the plaintiff Philips sued defendant Gigastorage for infringing its patent related to DVD-R techniques, and claimed an amount of NT$1,050 million. The original instance of the IP Court rejected the plaintiff's claims, but the appeal court reversed the decision and held the defendant shall compensate for the plaintiff the full amount of NT$1,039.5 million.

There are some important facts here:

    1. the period used for calculating the compensation is from 1 January 2000 to 14 February 2015;
    2. the plaintiff knew that the defendant manufactured the infringing products from at least 2003, but did not sue the defendant until 28 April 2014 – 14 years after 2000;
    3. the plaintiff had sued the defendant according to the patent for the same invention in Italy in 2004, but was rejected by the courts in Italy;
    4. the plaintiff claimed the compensation based on three distinct legal theories: infringement under Patent Act, unjust enrichment under Civil Code and negotiorum gestio under the Civil Code;
    5. the plaintiff claimed a reasonable royalty rate of US$0.06 per disk of DVD-R, and the rate is based on a previous bundle licence agreement involving 199 patents. In addition, US$0.06 is 42.8 per cent compared with 54.5 per cent of the ex-factory prices (US$0.11 compared with US$0.14) per disk of DVD-R.

The appeal court finally held that:

    1. because the plaintiff had been silent about the infringement for over 10 years and the cases in Italy decided in favour of the defendant, the defendant did not have intention or negligence, and thus the defendant did not infringe the patent;
    2. the defendant, however, had unjust enrichment under the Civil Code, where the unjust enrichment claim has a statute of limitation of 15 years from the date the claim became available;
    3. the issue of the negotiorum gestio under the Civil Code is not important in this case; and
    4. the US$0.06 in the bundle licence agreement involving 199 patents is a reasonable royalty rate for the present case, even though only one patent was infringed by the defendant.

There are three important legal issues involved in this case:

    1. whether the unjust enrichment under Civil Code may be applied in the patent law regime when it substantially prolongs the statute of limitation for monetary remedies for unjust exploitation of patents from two years to 15 years;
    2. whether the royalty rate of a bundle licence agreement may be directly used as a basis for the reasonable royalty rate in calculating monetary compensation for unjust exploitation of patents; and
    3. if the first holding in the preceding paragraph is correct, whether (1) there still is an unjust exploitation of patents, and (2) the fourth holding based on 'only one patent was infringed by the defendant' is viable.

    The defendant will appeal this decision to the Supreme Court. It will be very interesting to see how the Supreme Court will address these issues.

    IX OUTLOOK

    From the overall atmosphere of the court practices and decisions mentioned in Sections I and VIII, it is believed that Taiwan will become a jurisdiction that is much friendlier to the patent owner. Therefore, we believe that the practices of claiming monetary remedies and calculating damages or compensation, which are sometimes described as the last mile for realising the value of a patent, will become hot topics in Taiwan in the future.


    Footnotes

    1 Yu-Li Tsai is a partner at Deep & Far Attorneys-at-Law.

    2 See a report in 2014 made by the North America Intellectual Property Corporation: www.naipo.com/Portals/1/web_tw/Knowledge_Center/Industry_Economy/publish-314.htm.