Recently, the Intellectual Property Tribunal of the Supreme People's Court publicly pronounced a judgment on a dispute over infringement of the patent right for invention, fully supporting the patentee's claim for damages of 20 million RMB and reasonable expenses of 100,000 RMB.

The Swiss Synthes GmbH (hereinafter referred to as Synthes) is the patentee of the invention patent with the patent No. ZL03827088.9 titled "a Device for Treating Femoral Fracture". Double Medical Technology Inc. (Double Medical) is a listed company in China, specializing in the R & D and production of medical devices. Hunan Derom Medical Health Industry Co., Ltd. (Derom Medical Health) and Hunan Derom Medical Device Logistics and Distribution Service Co., Ltd (Derom Medical Device)Derom Medical Health and Derom Medical Device collectively referred to as two Derom companies) are the distributors of Double Medical. Synthes claimed that Double Medical manufactured, sold and offered to sell "Type A Femoral Locking Intramedullary Nail", which fell into the protection scope of the patent right involved in the case. The two Derom companies sold the above infringing products, and therefore it filed the lawsuit to the court.

 The court of first instance ruled that Double Medical and the two Derom companies should stop the infringement and applied the statutory compensation in the judgment that Double Medical should compensate Synthes for its losses and reasonable expenses, totaling 1 million RMB. Both Double Medical and Synthes was not satisfied and appealed to the Supreme People's Court.

In this case, Synthes claimed to determine the amount of compensation based on infringement profits, provided three calculation methods, and submitted evidence such as the enterprise's operating profit margin as disclosed in the prospectus of Double Medical and the number of alleged infringing products with a specific product number sold by two Derom companies through the website of "Derom Medical Equipment Mall". After the court asked Double Medical to provide the sales data of infringing products, Double Medical only provided the self-made printouts of 2014 sales data for the court's reference on the ground that the sales bills could not be found, and only four sales invoices were provided in the original trial.

The Supreme People's Court held that the patent involved in the case is an invention patent in the field of medical devices, which can simplify the operation steps, shorten the operation time, significantly reduce the operation difficulty of patients with femoral fracture, and is an important basis for the market attraction of patented products. The alleged infringing products belong to Class III medical appliances implanted into the human body. In order to ensure the patient's health and life safety, China requires that the production and sales thereof can be traced. As a listed Company manufacturing Class III medical appliances, Double Medical should have known the production and sales situation of infringing products of different models and specifications, and could accurately calculate its infringing profits through self-proof. Where the patentee has tried his best to provide evidence and the evidence as well as the calculation method of the claim can prove that the amount claimed by him is very likely to be tenable, although the infringer disagrees with the amount claimed by the patentee, the infringer only raises objection to the calculation method of the patentee, and refuses to provide the evidence in his own possession, the people's court may presume that the amount claimed by the patentee is tenable, and it may be determined in the case the infringement profit of the infringer according to the calculation method claimed by the patentee and the evidence provided.

Based on the number of infringing products sold on the website of   "Derom Medical Equipment Mall" proved by Synthes and the sales price of the above infringing products sold by Double Medical, considering the proportion of two Derom companies in Double Medical's operating revenue and Double Medical's operating profit margin, Double Medical's profit from the infringement of the above infringing products has exceeded 20 million RMB. For the profits generated by Double Medical through other sales channels and other numbered infringing products of two Derom companies, Double Medical's refusal to submit the corresponding account books and financial materials in its possession constitutes an obstruction of proof, and it shall bear the corresponding consequences thereof; even considering the patent contribution rate, it is highly possible that Double Medical has actually made a profit of more than 20 million RMB due to the infringing products involved. Finally, the Supreme People's Court fully supported the 20 million RMB damages claimed by Synthes.

                                                                             (Adapted from news of the Intellectual Property Tribunal of the Supreme People's Court)



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