Judicial Yuan announces draft amendments to the Intellectual Property Case Adjudication Act

On 24 June 2022, the Judicial Yuan announced a draft amendment to the Intellectual Property Case Adjudication Act, which, if approved by the Legislative Yuan, will be the most significant revision since its enactment.

As previously reported, in response to the criticism of the current IP case adjudication system, the Judicial Yuan began work on the revision of the act in 2020 and officially convened a committee to further research and draft the amendment in March 2021. The result of two years of work is the proposed amendment with 40 new articles and 41 revised articles. The key points of the proposed amendment are as follows.

• To enhance protection of trade secrets
  •  Jurisdiction over the first instance of a trade-secrets criminal case is transferred from district courts to the IP Court.
  • In a trade-secrets criminal case or its ancillary civil case, the court may assign codenames to trade secrets in the dossiers as a means of de-identification and to protect the trade secrets.
  • The proposed amendment imposes a heavier penalty for breach of a confidentiality preservation order and criminalises such breaches outside the territory. The proposed amendment also adds that such a crime shall be prosecuted even without a complaint by the victim.
  • In order to grant parties in a civil IP case access to confidential documents involving trade secrets in the dossiers, the proposed amendment enables the court, when it deems necessary, to issue a confidentiality preservation on motion of either party, rather than merely on motion of the party holding the trade secrets under current law.
• To promote efficient trials
  • The proposed amendment introduces measures that aim to promote efficient trials in civil IP cases, including mandatory representation by an attorney in certain types of action and regulations on the formulation and legally binding effect of a trial plan.
  • The court may disclose all or part of the report prepared by the Technical Examination Officer to the parties. Such a report may only be admitted as the basis of a judgment if the parties are accorded an opportunity to present their arguments regarding the report.
  • Unless otherwise agreed by the parties ― or for a case that shall be heard by the Commercial Court ― the first instance of a civil IP case shall be heard exclusively by the IP Court.
  • If there is dispute over the scope of a patent in a civil patent case, the court shall, where appropriate, conduct claim construction and disclose the court’s conviction on the issue to the parties.
  • In a case regarding infringement of a patent right, computer program copyright or trade secrets, if the alleged victim has made a preliminary showing of the infringement, the defendant shall provide reasons in its defence rather than simply denying the allegation.
• To include outside experts in the procedure
  • The proposed amendment introduces an “inspection” system with reference to the Japan Patent Act as a means to discover evidence, under which the court, hearing a patent right, computer program copyright or trade secrets infringement case, may, on request of a party, select a neutral technical specialist as the inspector to enter the defendant’s or a third party’s premises to collect evidence.
  • The expert witness system provided in the Taiwan Commercial Case Adjudication Act shall be applied mutatis mutandis in a civil IP case.
  • An amicus curiae system is introduced in civil IP cases, with reference to the Taiwan Constitutional Procedure Law and the Japan Patent Act, under which the court may, after hearing opinions from the parties, ask for the public to provide information or opinions on legal, technical or other relevant issues.
• To strengthen communications between the court and the IP Office (the central competent authority of IP rights), in order to reduce the burden of the parties making a redundant argument over the same IP right in both institutions and to avoid different judgments between the institutions.
• Where an IP right disputed in a civil action has been exclusively licensed to a third party, the licensor or licensee involved in the action shall inform the other party of the lawsuit in a timely manner.
• A specific court or division for IP cases shall be established in the Supreme Court.
• To add relevant regulations to correspond to the draft amendments to the Patent Act and the Trademark Act, which fundamentally change the appeal procedure against an IP Office decision regarding the validity of a patent or a trademark. Under the proposed “patent or trademark review and dispute procedures”, the appeal procedure is transferred from an administrative procedure to an adversary civil procedure, which will apply relevant civil procedure regulations.

The draft amendment will be sent to the Executive Yuan to be seconded and will later be reviewed by the Legislative Yuan.