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Application of "Preclusion Effect of Evidence" in Patent Invalidation-Related Administrative Litigations
In current patent invalidation-related administrative litigations, a petitioner of an invalidation action is allowed to submit new evidence on the same grounds in order to facilitate the resolution of the dispute once and for all and to prevent repetitive invalidation petitions. Regarding the time limit for submitting new evidence, the Intellectual Property Case Adjudication Act stipulates that it should be "prior to the end of the oral debate proceeding." However, at present, an administrative litigation before the Intellectual Property Court (hereinafter "IP Court") is generally begun with one or several preparatory proceedings tried by the presiding judge, and the final oral debate proceeding will then be proceeded by the tribunal; afterwards, the tribunal will announce the judgment. As such, a question arises: is an invalidation petitioner allowed to submit new evidence repeatedly until the date of the oral debate proceeding? In this regard, Article 40 of the Intellectual Property Case Adjudication Rules stipulates, in its proviso, that, "the court may, pursuant to Article 132 of the Code of Administrative Procedure applying Paragraph 2, Article 196 of the Code of Civil Procedure mutatis mutandis, dismiss the introduction of new evidence, if the conclusion of the action is impeded by the party's attempt to defer the proceeding or its failure, out of gross negligence, to follow the progress of the legal proceeding by presenting new evidence within an appropriate period prior to the end of oral debate proceeding." The effect of the above-mentioned "dismissal" is the so-called "preclusion effect of evidence."
As to the definition of "an appropriate period prior to the end of oral debate proceeding," there is no stipulation in the law. By observing the judgments rendered by the IP Court and the Supreme Administrative Court, one can understand that, in principle, said "appropriate period prior to the end of oral debate proceeding" refers to the period "till the end of preparatory proceeding." Therefore, even if a petitioner submits new evidence on the same ground after the end of the preparatory proceeding, such evidence would usually be rejected by the court as it is considered an inappropriate submission.
Nevertheless, in practice,sometimes the IP Court would adopt an even more severe standard in determining said appropriate period of submitting new evidence. In 2016 Hsing Zhuan Ghun (1) Zi No. 4 Administrative Judgment rendered on May 31, 2018, the IP Court held that the combinationof new exhibits submitted by the invalidation petitioner five days prior to the second preparatory hearing should be deemed delayed, and the Court therefore refused to take such combination into account.
In that case, the invalidation petitioner had been aware of the existence of the combinationof new exhibits as early as in the proceeding of the invalidation action, but did not introduce it at the first and second instances of the administrative litigations. In particular, the Supreme Administrative Court indicated in the holding to remand the case to the IP Court that, "although Exhibits 5 and 6 could prove that Claim 1 lacks non-obviousness, the original decision has not combined Exhibits 5 and 6 to prove the non-obviousness of Claim 3, the Court is thus unable to review such combination." The IP Court who reviewed the remanded casetherefore opined that, by the time of receiving the judgment rendered by the Supreme Administrative Court, the invalidation petitioner should haveclearly known that the combination of Exhibits 5 and 6 could attack the non-obviousness of all the technical features of Claim 1 contained in Claim 3.
However, during the remanding proceeding, the invalidation petitioner had not requested to add the combination of Exhibits 3, 5 and 6 in the proceedings of formality review, brief exchange and the first preparatory hearing until the presiding judge scheduled for the second preparatory hearing. The invalidation petitioner added the combination of Exhibits 3, 5 and 6 to attack the non-obviousness of Claim 3 only five days before the second preparatory hearing. In the remanding proceeding, it had been more than one year since the tribunal in charge of formality review first informed the parties to submit supplementary briefs within a specific period.
The tribunal of the IP Court trying the remanded case finally concluded that the invalidation petitioner should be subject to the "preclusion effect of evidence" due to its late submission of the new combination of exhibits and relevant arguments for the following reasons: "'said 'sufficient time to prepare for the response' should not be defined only based on whether the invalidation exhibit is easily understood or analyzed but should take the following factors into consideration: (1) Is there any reason that can justify the delay of submitting new evidence by the party? (2) Is the time for the parties to study and analyze the new invalidation exhibit equal and fair? After all, any newly submitted evidence takes time to prepare for the responses. The more time is given for preparing the response, the more adequate analysis and critical consideration can be provided. Further, new defenses could even emerge through further reflection and rumination on the new evidence. Thus, one party (i.e., the invalidation petitioner) should not be tolerated to willfully determine the time of introducing new evidence to enjoy the benefit of long-term preparation while the counterparty and the patent competent authority can only prepare for the response to such new evidence in a limited period… If a large gap in preparation time for the new combination of exhibits between the plaintiff (i.e., the patentee) and the intervener (i.e., the invalidation petitioner) is disregarded, the new combination of exhibits is allowed to be introduced for the court's substantive review and consideration, and the plaintiff's right of attack and defense as well as the conclusion of the proceeding are considered not being impeded only because the plaintiff is able to provide its substantive defense, it would obviously be a unilateral, one-sided mindset that only takes substantial justice as priority but disregards the plaintiff's rights of procedural fairness. We consider such a mindset to be abandoned."
In light of the above, in principle, the IP Court adopts the threshold of deeming "end of the preparatory proceeding" as "appropriate period prior to the end of the oral debate proceeding" to allow the parties to submit new evidence. However, in particular cases, if a party is able to but fails to timely submit the evidence, the court may adopt a more severe standard to consider whether such submission of new evidence is within an appropriate period and may even refuse to review the late-submitted new evidence.