Two Cases of "Melamine" Patent and Technical Secret infringement

February 2, 2024

Case Brief

Sichuan Golden-elephant Sincerity Chemical Co., Ltd. (hereinafter referred to as Golden-elephant) and Beijing EDGEIN Technology CO., Ltd. (hereinafter referred to as EDGEIN) are the right holders of the patent for invention No. 201110108644.9 entitled "System and process for melamine production by gas-phase quenching method of energy efficient and cost saving type", and Golden-elephant is also the right holder of the technical secrets relating to the melamine production by press gas-phase quenching method and the production system using the method. Golden-elephant and EDGEIN filed a lawsuit with the Guangzhou Intellectual Property Court against Shandong Hualu-Hengsheng Chemical Co., Ltd (hereinafter referred to as Hualu-Hengsheng) and the other three defendants for their acts infringing the patent right involved. Golden-elephant also filed a lawsuit against the above four defendants for their acts infringing technical secrets with the Chengdu Intermediate People's Court of Sichuan Province. The two courts found in the first instance that the four defendants had jointly committed the patent and technical secret infringement acts, and both ruled that the defendants shall cease the infringement, and partially supported the claims for damages. Both parties appealed from the judgments of the two cases. The Supreme People's Court held in the second instance that the accused infringers agreed on infringement, subjectively knew each other's infringement and implemented the corresponding infringement acts successively, which constituted a complete chain of infringing acts, and that they cooperated with each other objectively, which pertained to willful and joint infringement. The court decided that the defendants shall be jointly and severally liable for all the damage incurred by infringement. Consequently, the court changed the judgment to support all claims of the right holders, and ordered the infringers to destroy the infringing production system and the relevant technical secret carriers by means including but not limited to dismantling, and to jointly and severally compensate the right holders for the economic losses totaling 218 million yuan (including 120 million yuan for the patent infringement case, and 98 million yuan for the technical secret infringement case).

Typical significance

This is an IP infringement case with the highest amount of compensation that the People's Court has decided for the same engineering project up to now. The right holder Golden-elephant is a sino-foreign joint venture, the right holder EDGEIN is a high-tech private enterprise, and one of the infringers, Hualu-Hengsheng, is a state-owned listed enterprise. The rulings of the two cases not only demonstrated the court's resolute attitude to strengthen the IP judicial protection, but also fully reflected the equal treatment and protection for domestic and foreign-invested enterprises, state-owned and private enterprises and other types of enterprises. This case has reference significance for the handling of similar cases involving the determination of common intentional infringement and joint and several liability, the factors to be considered in the calculation of the amount of damages, the handling of the destruction of infringing carriers in the liability to cease infringement, and the like.

(Source of the case: website of the Supreme People's Court of the People's Republic of China)