Unitalen representing Tensar Corporation Won Patent Infringement Case against Fujian Construction Company

July 17, 2014

On May 9, Li Hongjiang and Kong Fanwen from Unitalen Law Firm won as the agent for the patent infringement case of Tensar Geosynthetics (China) Co., Ltd. (hereinafter referred to as "Tensar Company") vs. Sanming Water Resources and Hydropower Engineering Co., Ltd. (hereinafter referred to "Sanming Company") of Fujian, with the judgment by Fuzhou Intermediate People's Court that the defendant Sanming Company shall immediately stop infringement and compensate for economic loss of 215,000 Yuan.

Sanyu (Yundan) Reclamation Project in Jiaocheng District of Ningde, Fujian province was approved by Ningde Development and Reform Commission, with approval for construction by No.19 NFGSP [2012]. The project owner was the Construction Headquarters of Sanyu (Yundan) Reclamation Project. As the construction company of "Lot A", Sanming Company, knowing that there’s only one legitimate supplier of three-direction geogrid, which is Tensar Company, separately contacted BestBath Environmental Technology (Fujian) Co., Ltd. without the consent of the plaintiff, and purchased 15,000 m2 of alleged patent infringing products from Feicheng Lianyi Engineering Plastics Co., Ltd.

On November 20, 2013, Tensar Company sued to Fuzhou Intermediate Court, stating that Sanming Company infringed its invention patent of No. 03154700.1, and applied for preservation of evidence. On November 25, the Court ruled to give permission, and took one piece of the allegedly infringing product at the construction site of Lot A of Sanyu (Yundan) Reclamation Project. The issue in this case was: whether the defense of "legitimate source" of the defendant-Sanming Company can be established. Article 70 of Patent Law regulates: Use of patent infringement product for business purposes without knowing that it’s made and sold without permission of the patentee, and that the user can demonstrate the lawful origin of the product, is not liable for damages.

The Court concluded that: although the defendant sumitted evidences to show that the accused infringing product was purchased from Feicheng Lianyi Engineering Plastics Co., Ltd. through BestBath Environmental Technology (Fujian) Co., Ltd., it did not submit relevant purchase contracts and invoices in the trial, which could not prove the true origin of the infringing product. Meanwhile according to "Minutes" and statement to the court by the defendant, the defendant already knew the only legitimate supplier of three-direction geogrids was the plaintiff- Tensar Company in the construction of the project, later on it changed the supplier due to price of the product, then it should be aware that the change of supplier might result in the risk of infringement. Therefore, the defendant's use of the product concerned did not comply with the article of “Not knowing” which is required for disclaimers. Therefore, the court did not support the defendant’s argument for exempt of liability, which shall bear civil liability for invention patent infringement involved to the plaintiff.

Finally the court considered the fact that Sanming Company purchased only 15,000 square meters of allegedly infringing product from a third party, and the entire construction area was 300,000 square meters, considering the defendant did not make changes in the subsequent construction for other non-infringing product, therefore, the court ruled that the defendant immediately stop the infringement and was liable for damages of 215,000 yuan.

So far, all the enforcement litigation by Tensar for "three-direction geogrid" project represented by Unitalen have received support of the people's courts. Without Tensar’s permission, no one shall manufacture, use, bid, network promote, sell or mail the three-direction geogrid products, or they will bear the corresponding legal responsibility. If infringement were found during construction, Tensar Company will apply to the court to take preservative measures, which is bound to affect the construction schedule of the contracted works.