On April 21, 2009, China’s Supreme People’s Court promulgated its “Opinion on Several Issues Concerning Trials of IP Cases to Serve the Public Interest under the Current Economic Environment” In this Opinion, the Supreme People’s Court first clarifies that injunctive relief should not necessarily be granted in all intellectual property infringement cases. Under certain circumstances, the Court stated that an award of reasonable or sufficient damages can be an effective substitute for claims of injunctive relief.
In the Opinion, the Supreme People’s Court notes that if, “[t]he injunctive order, if granted, would significantly harm the interests of one of the parties concerned; or is contrary to the public interest; or would be impractical to enforce, the Court may, after considering the specific circumstances of the particular case, not grant the injunctive relief, but instead settle the dispute by awarding sufficient compensation, economic damages or through other alternative means.”
Traditionally, injunctive relief was available in all cases where infringement is established. The abovementioned guidelines offered by the Opinion will likely change such commonly-accepted practices under the premise of economic stability. The Supreme People’s Court also emphasized that the courts shall evaluate the losses suffered by the rights holder and award damages so as to sufficiently compensate for such losses. The Supreme People’s Court proposes to strike a balance between the public interest in economical stability and the private rights of Intellectual property right holders by suggesting that “sufficient compensation” is a viable alternative for injunctive relief.
As the Opinion is newly-issued, its implementation and its impact upon judicial practice in China will need to be further monitored.