Newsletter
Should Joint Defendants in Patent Infringement Proceedings Pay Court Fees Separately When Filing Appeal?
In civil proceedings for patent infringement, it is common for the patentee to list as joint defendants all or some of the participants in the supply chain of the concerned infringing product, such as its manufacturer, the brand owner and/or the distributor, and claim that these defendants should be jointly liable for damages and stop the infringing activities. Upon the patentee's filing of the complaint, the court needs to calculate the value of the patentee's claims, including the claim of damages and the claim for injunction, so as to determine the court fee to be paid by the patentee in accordance with relevant provisions of the Taiwan Code of Civil Procedure. Although multiple defendants are involved, the value of the claims shall be decided based on the claim with the highest value in the case of concurrent claims (see Paragraph 1, Article 77-2 of the Taiwan Code of Civil Procedure). That is, the calculation has nothing to do with the number of defendants. However, in the case that all of the joint defendants lose and intend to appeal the court’s decision, it is arguable whether some could claim exemption from payment if one of them pays the court fees for appeal, which are calculated based on the value of the interests claimed in the appeal. On January 24, 2018, the Supreme Court rendered Civil Ruling No. 107-Tai-Kang-Zi-54 and rejected such a position. According to the Supreme Court, when joint defendants appeal against respective portions prejudicial to themselves, their claims would not be deemed as concurrent. Consequently, the value of the interests claimed in the appeal by each defendant should be calculated separately based on their respective appeal statements; and since the value of each defendant's claims is calculated independently, one appellant’s payment of the court fees for appeal will not exempt the remaining appellants.
The background of the case is as follows: re-appellant Company A was listed as a joint defendant with companies B, C and D in a civil action regarding patent infringement. The Intellectual Property Court ("IPC") ruled against the joint defendants, and ordered that companies A, B and C shall stop manufacturing the infringing product in question, and recall and destroy those already manufactured. The IPC determined the value of claims and the court fees that companies A, B and C should pay for the second instance based on their respective appeal statements. Companies B and C paid their court fees, but company A filed a procedural appeal with the IPC, claiming that companies A, B and C would be undertaking an unreal joint-obligation. According to Company A, if one of the debtors of an unreal joint-obligation appealed against the court’s judgment and fully paid the court fees arising therefrom, such full payment would settle the entire obligation; therefore, the remaining debtors of the unreal joint-obligation need not pay the court fees when filing an appeal.
The IPC dismissed the procedural appeal for lack of grounds. The products at issue were jointly manufactured by companies B and C and then marketed by the agential company A. With regard to the original judgment requiring companies A, B and C to exclude infringement and to recall and destroy the products already manufactured, the aforesaid three companies are independently capable of fulfilling their obligations of action and non-action. Thus, fulfilment of obligations by companies B and C will not exempt company A from its obligation. Furthermore, company A appealed for interests different from those of companies B and C. Hence, their interests of appeal and expenses for the second instance should be calculated separately.
The aforesaid ruling is affirmed in Supreme Court Civil Ruling No. 107-Tai-Kang-Zi-54.