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The Judgment 2022 Tai Shang Zi No. 186 rendered by the Supreme Court Affirms "Commercial Success" as Significant for Determination of an Inventive Step
To determine an inventive step with objective thresholds and avoid hindsight, in the Patent Examination Guidelines, "Commercial Success obtained from the Invention" (hereinafter referred to as "commercial success") has always been included as an auxiliary factor for determining an inventive step of a claimed invention. Before a decision on the patent application is rendered, if an applicant submits evidentiary documents to prove that commercial success was obtained from the technical features of a claimed invention, then an examiner shall take such documents into consideration when assessing an inventive step of the patent application.
Nonetheless, the thresholds for the applicability of "commercial success" in judicial practices do not seem to be stable yet. An overview of the decisions rendered by the Supreme Administrative Court (hereinafter referred to as the SAC) and the Intellectual Property and Commercial Court (hereinafter referred to as the IPCC) shows that, even within the same court, there are different thresholds and opinions on whether to take "commercial success" into consideration or not: Opinion 1, wherein "commercial success" is no longer taken into consideration by the court as long as the prior art is sufficient to prove that the claimed invention lacks an inventive step, and Opinion 2, wherein "commercial success" is taken into consideration by the court provided that the patentee claims and presents the evidence to support commercial success.
1. In terms of Opinion 1 decisions, the judgment 2020 Shang Zi No. 575 rendered by the SAC states that "commercial success" is simply an auxiliary factor for determining inventive step—not the sole factor—and that the success of a patented product may be subject to other factors such as sales skills, advertising, market supply and demand, and socio-economic prosperity. As the prior art combination was sufficient to prove that the patent lacks an inventive step, it was unnecessary for the court to take the auxiliary factor of "commercial success" into consideration. The IPCC's 2015 Min Zhuan Shang Zi No. 29 judgment shares the same opinion.
2. The SAC once rendered the 2019 Pan Zi No. 100 decision stating Opinion 2. The SAC emphasized that it is the patentee who is liable for providing evidence to prove the direct relation between "commercial success" and the patented invention. Ultimately, the SAC did not recognize the patentee's claim on "commercial success" because the SAC deemed that the patentee failed to provide sufficient evidence to prove the relation between the growth in business and the commercial exploitation of the patent at issue.
There are also decisions rendered by the IPCC where the "commercial success" factor was taken into consideration. For example, the 2018 Xing Zhuan Su Zi No. 75 administrative judgment is a case where the IPCC took the "commercial success" factor into consideration and affirmed an inventive step of the patent. In this case, the patented technology was related to a food cover for thermal preservation. While the prior art for said cover was non-foldable, the patented one at issue was foldable. Since the patentee provided evidence to prove that only counterfeits of the patented foldable cover exist in the market rather than non-foldable ones, the IPCC held that the evidence sufficed to prove that "the technical features of the foldable design of the patent at issue, rather than sales skills or advertising, indeed directly contribute to the commercial success." Thus, the evidence was adequate to prove that the patent at issue achieved commercial success, and the court recognized the inventive step of the patent.
In August of this year, the Supreme Court rendered a judgment 2022 Tai Shang Zi No. 186 opining that the subordinate courts are required to examine the evidence and claims of commercial success submitted by the patentee when deciding an inventive step of a claimed invention; otherwise, the decisions will be unlawful. The Supreme Court states that "When determining an inventive step of a claimed invention, the subordinate courts may also comprehensively take the following factors into consideration to avoid misjudgment caused by subjective arbitrariness (such as hindsight): 1) if an invention solves a long-felt but unsolved problem; 2) if an invention achieves commercial success and replaces the products with the prior art; 3) if the licensee and competitors acquiesce in the invention; 4) if an invention was recognized or reproduced by the infringers; or 5) no similar or identical invention(s) exist around the same time. The appellant insisted on the claim that the patent at issue had been granted in many countries, such as the United Kingdom, the United States, China, and Japan, more than 20 years ago. The domestic voice IC industry, including listed companies such as…, having been involved in the licensing of the patent at issue after reviewing the technical contents thereof, has exported billions of ICs with the patented technology at issue. Therefore, it is adequate to recognize the claim that the patent at issue has solved a long-felt but unsolved problem and has achieved commercial success. The patentee also provided the patent specifications or patent gazettes of foreign counterparts of the patent at issue as well as the first page of the patent license agreement as evidence... In light of the above explanations and general rules of experience and logic, the patentee's statements on "commercial success" appear to have merit and indeed affect the determination of an inventive step of the patent at issue. The original court ignored the patentee's statements on "commercial success," not only violating rules of experience and logic, but also failing to provide reasons."
In conclusion, the preceding judgment rendered by the Supreme Court clearly not only indicates the five factors that may be taken into consideration when examining an inventive step of a patent so as to avoid hindsight, but further elaborates that "commercial success" claimed by the patentee does affect the determination of inventive step, and shall not be ignored by the original court; otherwise, the decisions made will be unlawful. The significance of "commercial success" for determining an inventive step is thus affirmed by the Supreme Court. Accordingly, a patentee may cite the opinions of this Supreme Court judgment in the process of a patent application or cancellation to proactively defend an inventive step for a patent.