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>> Operator: Welcome and thank you for standing by.
Today's conference will be on a listen only mode.
During the question and answer session, please press star one
on your touch-tone telephone.
Today's conference is being recorded.
If you have any objections, you may disconnect at this time.
Now I'd like to turn your call over to Janice Wingo,
International Trade Administration.
Ma'am you may begin.
>> Janice Wingo: Thank you and good morning.
Today we're very lucky because we have lawyer He Jing
from the Beijing firm of ZY Partners to talk
about his punch list on IP enforcement.
Just to give you some background lawyer He, he has a degree
in physics from Peking University.
Then he obtained his Juris Doctorate Degree
from the University of Notre Dame.
He's admitted to the Bar in California.
And he worked for a large US law firm in California
and then another one in Hong Kong.
So he has over ten years of practice experience,
and now he's with ZY Partners
where he assists people in China.
Lawyer He said if you'd be willing
to take questions after the recording.
Please hang on the line so you can ask him some questions.
He Jing?
>> He Jing: Hi.
Thank you Janice.
Thank you everybody who joined this webinar.
So today I will just highlight some of the key actions we think
that may be quite useful for the companies that are interested
in conducting business in China.
Now I summarize them as eight actions; in fact,
of course there are going to more actions to be done
but we think keeping a list may have you to concentrate on some
of the things that could be very important in China.
And for those of us on audio but you are not able
to see the slides right now, I just want you to quickly list
out some of the actions I'm going to talk about today.
These eight actions, and I think
that register your IP is probably most important one.
And then I will talk about raid actions, what are the kind
of raid actions you could take in China
to stop the infringements and cleaning up the Internet sites.
And number four I list out Scout trade fair for infringement.
You know China has some very big trade fairs
where many people find that their products,
their innovations were copied and then displayed
at those trade fair for the potential customers.
And the number five action I propose here is
to stop shipment at the borders.
Many people actually may not be really fully aware
that China has a very effective customs video actions in place
that could be helpful for the IP owners.
And the sixth actions is that the freedom to operate.
For people are really targeting at the China market
that the patent infringements is actually becoming a substantial
kind of a risk can people really see it.
The seventh action I'm going to talk about is
about the civil actions.
And a lot of companies are have still valid, justified fear
about doing the civil actions in China.
But I want to say a little bit
about the civil actions in China.
So you may be starting to think
about whether civil actions could be something you could do
in the future.
The last one I will talk about is acting in groups.
Now the first action I want to talk
about the registration IP in China.
For those of you who may not be really, you know,
done a lot of studying or research in this area just,
so you know in China you can register your trademark,
you can register and file patents,
and you can file design patents to protect your design
and you know copyright is also protectable in China.
You don't need to register it.
Of course if you have a registration
that will be helpful but the copyright once you have a
copyright in works, in place,
then the copyright is recognized in China.
And also plant variety life is also protectable in China.
And so for those of you
in agriculture area that's some inventive kind of variety maybe,
you know, being protected in China.
So why the registration of the IP is important:
They're taking the trademark as example.
Some of you may have heard that the problem
of trademark squatting, what we typically talk
about the cyber squatting, which is more about the domain name.
But unfortunately in China, because the country is so big
and the system is relatively, you know, less-developed,
so there are many Chinese factory individuals;
they take advantage of the tiny difference of the [inaudible]
into China, they actually manage in a way
that the investor [inaudible] owners own trademarks
in China using that for commercial advantage.
You know, sometimes they want to sell the trademark,
they high priced, sometimes they just actually launched their own
product, their own service under those names.
So in this slide I'm presenting, I just leave some
of the examples of the squatting the trademarks.
And the next slide actually shows some latest examples
of one of the Chivas Regal.
You know, we all know the Chivas Regal is popular liquor brand.
But a Chivas individual to file this mark for closing,
you know, about nine years ago.
The Chivas Regal filed a case trying
to stop the registration of the trademark.
Unfortunately after nine
or ten years' fight the Chinese local courts will still not rule
in favor of, you know, the Chivas Regal.
This company has been fighting in the court.
Probably the case may end up being in the super court.
Another example is it's Little ***, okay?
And another individual almost exact same time back
in 2003 applied for the Little *** mark in printers,
electronic dictionaries.
Again, in this case Pfizer trying to oppose this mark
but it was not being really successful.
The latest court decision in Beijing, again,
did not really support the decision of ***.
The reasoning is, "Hey, if *** wasn't
that well-known back in 2003, so the Court not willing
to support the Pfizer in this fight."
So treat it like this actually, it's not really uncommon
that we have heard of many instances like this,
like the foreign companies are really find the squatting
of trademarks, [inaudible] applications and one
of big headaches in the trademark area.
So again, why it's important to do the registration, you know,
for people who, you know, on this call you are not a lawyer
or you're not really doing the IP law,
just so you know the IP is really territorial,
which means that when you have a trademark in the US, in Japan
or Europe it does not mean
that you have the protection in China.
If you have a patent in US or in Europe
but you have not registered that particular piece of a patent
in China, then your patent actually is really not
protectable in China; you may still protect it in the US
but you have very little remedies to protect your patent
in China if you have not registered it, okay?
And another more probably more important factor is China
actually, you know, even though the IP [inaudible] relatively
young, probably only four the last 20, 30,
years the Chinese business people,
the awareness IP has really increased in the last ten years.
The people just know IP is important now.
You know, people register lots for brands,
and lots for trademarks, and lots of the patents.
China, it's probably one of the has recorded or one
of recorded highest of the patents in some of the areas.
And the growth rate is still about 30%,
40% in the last five years, every year.
So the message is if you have not yet filed your trademarks,
patents, registered them in China,
the chances are your competitors --
the Chinese or non-Chinese -- they might do that.
Okay? If they have registered the patents which you don't
and also cover your product,
that can really become a problem for you.
And another, the second other way --
and if you have registered your patents, you know,
even if you are small company
where you have some good protection in China
for your patents or trademarks --
especially for patents actually --
it may really give you a very good tool to deal
with a big size competitors whether the Chinese companies
or the western companies.
I'm not saying here, you know, the patents can deal
with every issue will really help you win the market,
capture the market.
Okay? But when you have the patents
that will really give you,
yourself the huge favor, huge advantages.
Now here we also want to offer some quick tips
on developing IP portfolio.
Okay? Just repeat what I said earlier, the filing,
the timing is very important.
File as early as possible.
File as early as possible.
The second tips is protecting your marks
in Chinese characters.
If you are very serious, if you're interested
in the China market, okay, and, you know,
we highly recommend our client to come
up with the Chinese marks, okay?
Sometimes it can be just transliteration,
sometimes can be a completely new -- the new way thing --
your mark in Chinese characters.
Or just picked, you know, the popular Chinese name
that people recognize your mark or your service
and register that for yourself.
If you don't do that,
again someone else might have done that.
And then that will block your chance
to pick a very good Chinese name.
The number four tips is being careful about what you've done
in the patent [inaudible] stage.
Okay? For those
of you [inaudible] phone call each doing the patent filing
China, just remember this actually:
What you do in the filing stage can have a very big impact
on the value of the patents in the future, okay?
The quality of the wrapping, the quality of the translations,
it's key to make sure your patent are useful in China.
The last tip, again, related to patents
and if you have the same patent filed in the US
and the Europe be mindful what you said or what you done
to the US patent or Europe patents in those countries --
what you have said, what you have done in US patent office
or Europe patent office may be used against you
in China in the future, okay?
It's not something, it's not really intentional
or it's not just because Chinese Patent Office wants
to do something intentionally bad against the western company,
it's become [inaudible] in the patent practice
that whatever you say outside China could be considered
by the examiners in China.
Again, this is about the quality of the patent classing
and patent examination.
So these are just some the tips we would like to offer for you
in developing the IP portfolio in China.
Now the next one, the next action, I want to talk
about here is about doing the raids.
This is more about reinforcement.
Okay? If someone infringes your IP rights,
what are you going to do.
All right?
Basically I want you to be aware of that in three major ways
for enforcing China IP.
The first one we call criminal actions,
this is the one really done by the police actions.
And the second one is a civil actions,
we call the IP owners file the lawsuit in the court.
The third one is administrative.
This one it's very unique to China.
China is sometimes very proud of it, always keeps saying, "Hey,
we have administrative ground to enforce IP."
This just means that instead of going to the court,
going to the police, you're going
to the administrative authorities of the governments
to say, "Hey, I need you to do the raid actions."
The events of the administrative actions is
that it's relatively cost efficient.
Okay? And the problem is
that it's not really deterrent enough.
If you want to say hey I want to do something, I want to put
that person in jail, this is not the option you want to go for.
All right?
Normally what happens is
that the administrative authorities will impose fines,
they will seize the counterfeits,
the packaged items and destroy them.
And that's about it.
Okay? And some IP owners are frustrated because,
hey the same infringer may come back, after some time.
But some people like it because it's relatively quick and dirty
and have to deal with [inaudible] problems.
But it's definitely not the one that you want to rely
on if you are dealing with some large-scale infringements
in China.
The number three action I want to talk about here is cleaning
up the Internet sites.
It's really exaggerating here
for use the term clean up Internet sites.
For those of you who are not familiar with situation in China
about the Internet shopping or the e-commerce in China,
I didn't want to say that.
The Internet shopping,
the online trading are really thriving in China, okay?
And many people, especially in the urban cities
and the younger generation
who actually even the middle age families,
they are really using the Internet shopping a lot
to buy almost everything from groceries to clothes,
you know, electronics devices.
It's a huge market.
And you know people just love to buy things from the Internet.
And everybody else out in China.
Now that's actually creates a problem
for the patent owners, for the IP owners.
And because it's much harder
to trade [inaudible] from on the Internet.
And the consumers are much easier to be mislead, you know,
by looking at the pictures to, you know, on the Internet.
So by now I feel there has been trying to put a lot of pressure
under the large treaty platforms.
In China we have Taobao, we have [inaudible].
We quite a few of the large online treaty platforms.
But so far the online treaty platforms have been responding
to some of the pressures.
But even the size of the infringement, even the scale
of the problems, nobody has really come
up with an effective solution.
And on online treaty platform,
understandably that's not really you want to take too much work
to do self-disciplinary actions, picking up everything,
to monitor actively what's on the website.
Right? And the government's often really scratching the
heads of what exactly can be done.
So this is one of the area.
If you are caring about -- even really interested in --
the China market want to do business, want to have a brands
of the good designs available in China for the China consumers,
you really need to checkout what's going
on in those big Chinese Internet sites.
And some of the, you know,
findings may be really surprising to you.
The fourth action is related to the trade fairs.
This could be important for --
especially important for the people who do lots
of OEM business in China.
Okay, you have your OEM innovation design,
you put that in China, you want to pick them out,
you make them ordering, and then you ship them outside China.
And infringement often displayed,
the infringement items at a trade fair, the copy,
the designs offer the same thing at probably
at a much lower price.
So if you are in the OEM business or you are caring
about the China markets, I highly advise you to think
about doing some IPR clean up actions at the trade fair.
The trade fair organizers work with the local governments,
have a mechanism to do the very quick raids --
I believe they ask the infringer to withdraw
or taking the stuff off the shelf, off the display counters.
Okay? That doesn't mean it's decision of the infringement
and the trade fair organizer will not impose a fine.
Okay? Eventually if you want to continue to deal with that,
you have to go through important protest
like civil action or criminal actions.
But the clean up at trade fair have the controls.
It's relatively important for you.
The number five action, is stop [inaudible] at borders.
In China it's very unique,
the customs inspect both imported goods
and exported goods for IP infringement.
Not many times they are doing inspections
on exported goods for IP infringement.
Okay? And the Chinese customs,
it's fair to say the Chinese customs probably one
of the most probably competent and proactive,
the more organized, enforcement agencies in China,
even though there are still lots of big brands
that are not really satisfied with what they've done.
Every time when they see the huge containers
of counterfeits arrive at a port of the, you know, the US ports.
But still, you know, if you look at seizures of custom actions
at the Chinese ports, it shows that the Chinese custom
at least doing the checkings
when the suspicious items are discovered.
You know, they really see that.
And they send a notice when owners say, "Hey,
what is this counterfeit, do you want to take action or not?"
So, but to really make that work,
you have to have your trademarks in place, registered in China,
and also with court, [inaudible] procedure
with the Chinese custom authorities,
which not really hard.
It's not really expensive at all.
And, you know, have system in place and ideally, you know,
do some training with the local custom officials
that are familiar with your brands and have action done.
But just so you know, if you're really going forward
with the custom seizure actions and, you know,
you have to get a paperwork done and also you need to be prepared
to deposit some monetary bonds.
The bonds requirements, it's, you know, it's prepared by --
it's really required by the customs just
in case something goes wrong, you know,
in case some parties abuse the procedure.
So, but the amount of bonds is not -- it's not very high, okay?
It's part of the scale, the scale links to the amount
of the goods or amount
of the declared value of the seized items.
Now before I go to the next pages, here I just want
to offer you a very quick summary
about the anti-counterfeiting strategies
that we often recommend to our clients.
In China because the scale of the problem is quite big
and also because of the resources,
the enforcement resources is relatively limited
and it's also fair to say
that so far the IP enforcement is really not
on the very high priority of the governments.
So it really takes stamina and really takes persistence to deal
with counterfeiting and piracy.
Okay? Normally the smaller companies are finding it very
challenging to have a problem resolved in China.
And the bigger western companies, you know,
because they have a much bigger presence,
they have a much stronger local teams,
they probably get more attention from the Chinese governments.
So for smaller companies, don't really hope that, you know,
the problem can go away overnight.
And to some of the business, you know, the reality is:
Is it really part of the competition in the markets?
So this part you have to be really realistic.
But you cannot give it up.
You probably cannot afford to give it up at all.
If you don't do anything, and --
the counterfeiters, they will smell it.
You know, they know which brand is the most vulnerable.
You know, if you look -- if you go to some of the [inaudible],
you know, Chinese retail wholesale markets, you know,
you can see some
of the well-known brands are much less visible
than the other brands.
Why? Because those most visible
of the counterfeited brands are probably the brands
that are totally cynical and hesitant about taking --
doing anything in China.
So their brands end up probably the biggest victims
in those markets.
But for the other brands, they, because of the fake market,
they spend a lot more resources.
You know, the actions have some produced some results.
And whenever you got a good case, whenever you find
for the case the exit's clear and, you know, good location
where the important authorities are more reliable,
we highly recommend you select and win the cases you can win.
The number six, the clear risks of infringements.
This is what we called
at the very beginning we called the freedom to operate.
For the companies that are really willing
to launch a product in China or even doing a lot
of manufacturing and exporting, to export out of China,
the patent infringement is something --
it's we really need to think more about it.
As I've said at the very beginning,
the Chinese companies are finding more and more
of the patents in China these days.
And some of patents are in -- are good quality;
not everything is bad.
Of course there are a lot of -- we say junk patents.
But some of patents can cause a big problem to you.
The example I put on the slide is the Schneider case.
Some of you may already have heard about this,
probably it's the most famous in Chinese,
in Chinese patent cases so far.
The French company lost the patent case
to a local competitor in the Chinese court.
The Chinese court ordered about $40 million --
$40 million US dollar as damages against the other side,
against the Schneider.
Of course, people have very different views
about hey whether this case is fair or not,
but I think it's fair to say this case is one of the examples
to demonstrate it's quite important now for US companies
or European companies that are doing business in China
to really doing some serious patent research and to figure
out whether the key products are of any risk
of infringe someone else's patents,
maybe your key competitors.
You know, maybe Chinese competitor
or non-Chinese competitor.
Let's doing a check.
You know, that's not necessarily cost that much.
But it's good to have this practice in China as well.
We have seen the local companies are getting really sad here
with the patents strategies.
They know how to use the patent lawsuit
to disrupt the competitors [inaudible] strategy in China.
The number seven action, I will talk about civil action.
Okay? It's to -- for smaller companies settling a civil
action and doing a court case in China probably sounds like,
you know, a daunting task if you have never, you know,
filed any cases in China, okay?
We're not really trying to convince anybody here
to just hey, just go into court to file the case, right?
But point I want to make here is that it's getting closer
to the time that you should really look at this as option
when you're get into, you know, dispute.
Actually, it's not just IP dispute;
it could be the commercial type of dispute.
The court action may be something you should really
consider about, even though there are so many, you know,
imperfections these days.
If you just, you know, suspicious about it
or just worries about it,
it just really limits the way you can take effective actions.
In China the reality is that the IP suits are
really fast-growing.
About every year is about in the past five,
six years every year filed 10 or 20
or even 30 percent growth rate.
Last year in the 2011 the total number of IP cases,
it already reaches 50,000 cases -- 50,000 cases.
In comparison, I believe in the US the total number
of IP cases are about something around 9,000 cases.
Of course, you know, when I pulled
out the numbers we're running risk
of comparing apples with, you know, orange.
Okay? There's a state [inaudible] difference.
There are lots of very smaller types
of claims in IP cases in China.
But I still want you to know that, you know,
Chinese litigants are --
you know, Chinese [inaudible] is getting more and more litigious.
Okay? Going to the court is not something they're ashamed of.
And the Chinese judges have seen quite a few --
you know, a lot of those foreign companies come
to the Chinese court to litigate.
So they are getting more and more experience.
And just taking example of the [inaudible] patent cases,
they're getting, they're actually Chinese court cases are
moved quite relatively fast.
Most of the cases can be really concluded in two years.
For the [inaudible] you can pretty much get
that done in one year, okay?
That's actually quite fast compared to a lot
of other jurisdictions.
The cost, you know, depends on the stake
or the complexity of your cases.
You know, you should be really looking to find the counsel
and really find out, hey what could it cost you?
The IP judges are getting more experienced.
In fact, compared to judges in other fields
like criminal judges or commercial cases judges
or civil case judges, Chinese IP judges are younger
and probably more educated.
This is a really a general consensus.
The IP judge is probably the best quality of all
of the judges in China, you know?
The judges in China are more
like specialized type of judges, you know?
Unlike the US.
You know, the one US judge can deal with a wide spectrum
of cases -- criminal cases, you know, commercial cases,
a patent case, a trademark case --
but in China the court divided judges
into different we call tribunals.
Okay? We have IP tribunal,
criminal tribunal, civil tribunal.
So it's relatively specialized.
So we have [inaudible].
You know, some Chinese judges really, really smart.
They can really dig into their complicated technique
on patent issues.
And also Chinese court always actually updating the rules
and regulations at quite impressive pace.
And they issue the [inaudible] or devise the opinions
and the legislature are updating the patent law
and the trademark law, copyright law.
Right now China is really amending its patent law.
And, I don't know, sorry,
China's amending the copyright law and trademark law
at the same time, at this moment.
So even though nobody expects these amendments will make
everything perfect, but these kind of ongoing changes
and improvement or updates of the law offers the incremental
or gradual changes, improvements.
This is some example in the slide that I show.
For example here, you know, Strix is a UK company
that won the damages in the patent case.
They got $1.4 million US dollars.
This is, I'm not saying that in every case you can get these
kind of damages, but I just want an example
that when things are really planned very well
and they have solid case, you know,
the Chinese judges are willing to award a decent amount
of the damages -- may not be the kind of damages you can get
from a US court, but in the Chinese standard $1.4 million US
is relatively substantially.
Another example is the Neoplan, this German auto design company.
They won a design patent case against two Chinese auto makers.
Auto makers considered very large Chinese companies.
They got a lot of local government support.
But in this case the Beijing court here did a very good job I
would say.
You know, they gave the $4 million US dollars
to the German auto design companies
for this big shuttle bus design.
And that's a very impressive victory.
So this is just a couple of examples that a --
some positive outcome can be accomplished.
The number eight actions, the acting in groups.
This is -- may not be something easy to be implemented, okay?
I say this is because based on what I know
about US, European companies.
They tend to do things on their own.
Here I will actually I offer [inaudible] a different view.
Okay? Whenever possible, actually, we actually advise
or recommend our clients in dealing with the IP issues
in China it's quite important to get positive attention
from the government at all levels, you know in China,
from the national and local levels.
How can you get that, you know, if you're a small one, right?
And when you're not really big, when you're not doing
that huge investments, the probably the only way to do
that is -- oh, actually probably two ways,
one is through diplomatic efforts, you know,
the US Department of Commerce, the USPO, and the USTR
and the US Embassy, they are very active,
they are really willing to support the smaller companies.
But important thing is that, you know, you need to find a way
to group together -- one of the natural way
to group together is probably around industry associations
or business organizations.
You know, if you have already have --
if you're active in some kind of industry associations already
in the US and some of your members run into the same kind
of issues in China, instead of going one by one, okay,
and it's probably a more productive approach.
And by group together and the using the industry association's
name and getting help from, you know, [inaudible] channel
and the using what we call the lobbying approach.
You know, not just policy.
When people lobby, the more I think about they change the law,
change the policy it could be done that way.
But in terms of action lobbying, it's, you know,
if you are working,
acting behind a very well-organized professional
organization or industry association,
that might be really make it much easier
to get some special attention from the governments
and to resolve your problems.
So that's a very quick run-through of the --
what we call top eight actions in China IP world.
And that's the end of my presentation.
I will probably leave the time now for some of the questions.
>> Janice Wingo: Thank you, Lawyer He.
Don't be shy.
Lawyer He has lots of experience in advising companies.
And he's happy to take questions over the phone today.
You can also email him at his email address at zypartners.com.
Operator, can you tell people how they can call in?
>> Operator: Thank you.
At this time if you would like to ask a question
over the audio, please press star one
on your touch-tone telephone.
You will be prompted to record your name
in order to be introduced.
Once again, please press star and one
on your touch-tone telephone.
Please stand by for any questions.
[ Pause ]
One moment.
We have a question from Kathy Fyke [assumed spelling].
Your line is open.
>> Kathy Fyke: Hi.
I have a lot of clients that have concerns
about whether they're filing for a patent or a CE mark
or something in China.
They're worried about when they have to give the details
of their product -- the plans and stuff --
they're worried that that's going to get
to their competitors in China.
How valid is that concern, and how do you respond to that?
>> He Jing: The CE mark, right?
This is more about the specification.
>> Kathy Fyke: I've had it for both, actually.
I've had it [inaudible] and I'm registering a patent there
as well.
>> He Jing: Well, for registration patents,
that's more about, you know,
what we said regarding the clarity of the specifications,
the insufficient disclosure.
And we -- that's not probably more, it's probably less
about the trade secrets.
Okay? It's more about whether we really disclose enough
information to support the claimed invention.
All right?
And we have not seen the Chinese Patent Office --
while this might, you know,
depend on the different technology sectors,
probably it might happen more on the bioindustry
as I can imagine -- but generally speaking,
the disclosure in the patents are more becoming issue
for the invalidity cases, okay?
It's not happening very often
that a patent office will directly asking the applicants
for more disclosure or information at the time
of the filing or during the patent examination, all right?
But this may not be the same for the biopatents.
Okay, I'm not really -- I'm more on the electrical
or mechanical type of patents.
I'm not a -- my background is not really
about the chemistry or on the biology.
So that's the part about the patents.
The single message for patent is that, hey,
normally whatever you used for filing for US
or Europe should be sufficient for filing in China, okay?
>> Kathy Fyke: Okay, good to know.
>> He Jing: We're not really [inaudible] using
something more.
For the specification thing, that's much trickier, all right?
From what we have heard, that --
it is quite a controversial area.
You know, in China this is what we more refer
to as a market access problem, okay?
If you're punching through the European delegation here,
maybe it's, you know, US Embassy as well,
the companies are really not so satisfied
with the specification procedure.
For a lot of products,
especially for technology products,
of getting to China they have to go through certification.
And then the Certification Center will, you know,
asking all kinds of questions, asking more and more details
or the procedure getting very long
or sometimes getting very expensive.
There are really no perfect solution at this moment.
Okay? I don't know what you offer to your clients.
But probably the best way to say is it is a risk.
Okay? It is a risk.
But if the client really, like, really want to get
into China market, probably the most reliable way is
that it finds a very good local maybe consulting firm and agents
that have relatively reliable relationship
with the Certification Center in the relevant, you know, sectors
and have the job done.
This is really, you know,
most of the time this really the communication job.
For if the smaller companies have no presence in China,
you know, they're not easy to communicate, the Chinese,
the technicians, the officials, the Certification Center,
it's not hard to imagine, you know,
there will be lots of problem come up.
You know, even if we're talking about the leak
of the trade secret issue.
>> Kathy Fyke: Okay, very helpful.
Thanks.
>> Operator: Once again, if you would like to ask a question,
please press star and one on your touch-tone telephone.
Once again, that's star and one.
Please stand by for any further questions.
[ Pause ]
We have a question from Cora Knutzen [assumed spelling].
Your line is open.
>> Cora Knutzen: Thank you.
You had mentioned a couple of Internet sites.
We're familiar with Taobao, but I didn't catch the name
of the other one; would you be so kind as to spell that for me?
>> Donge [inaudible].
>> He Jing: [Inaudible] is another one.
And also 365.com is another very popular one.
They're probably getting better.
I think they're putting a lot more business for themselves.
You know, some of them [inaudible] themselves
as a B to C site.
That's a little bit better.
The C to C sites are the most problematic sites.
>> Cora Knutzen: Thank you.
>> Kathy Fyke: Cora?
>> Cora Knutzen: Yes?
>> Kathy Fyke: I just wanted to let you know
that we actually did a webinar with a lawyer from Taobao
and a lawyer from its sister company, alibabba.com,
and they explain in step by step how you can file a complaint
if there's an unauthorized posting to those websites
and you can find that on the stopfakes.gov web page
or just shoot me an email, janice.wingo at trade.gov.
>> Cora Knutzen: Wonderful.
Thank you so much.
>> He Jing: Yeah, for those help out procedures I think the,
still -- the thing that people are not satisfied is
that the Taobao still following the take
down [inaudible] approach.
Okay? You have to send the report to them.
They actually -- from what I heard they act quite fast.
And they can take those down.
But the problem with that, the online vendors will repost
or find another way to post the same kind of thing,
the listings, again, okay, without paying anything.
And that's become like a tricky game now.
Taobao is not willing to, you know, proactively filter them
out or get rid of the other, the same kind
of counterfeit listing.
And they have appointed two outside service providers,
which we think they have them equity interest in that as well
to say, hey, if you go through that two investigation
surveillance companies, actually one
of them have a strong backing of the government to support --
you know, if you use them they can do automated and monitoring,
they can send out the listing on weekly basis,
then we can automatically take them away.
All right?
One of my clients is doing that, and apparently the report --
it's not bad, actually, that we [inaudible].
But [inaudible] we solve the problems.
Okay, things are still coming up.
And some big brands are not comfortable to work
with those two companies.
And so they still want the Taobao to come
up more systematic approach.
But so far this is still being, you know,
is really not resolved.
The Chinese central governments, the latest the news is
that the one they use is the black list approach to deal
with the online vendors.
Basically the idea is, hey, if we receive a lot of complaints
about this vendor, then the online trading platform should
completely ban the entry of that online vendor.
Or if the online trading platform always has a problem,
they could impose some serious punishment
against the trading platform.
>> Cora Knutzen: Wonderful.
Thank you.
>> Operator: And at this time I'm showing no
further questions.
Once again if you would like to ask a question,
please press star one on your touch-tone telephone.
That's star one.
Please stand by.
Cora Knutzen, your line is open.
>> John Zane: Hi.
My name is John Zane [assumed spelling],
I'm listening to this webinar.
It's very useful.
My question is: We are fairly new to the Chinese market.
While we're talking with our prospects,
we don't have any relationships with them yet.
Some of them, they went ahead
and created their own names for our brand.
And it's quite annoying.
Should we go after them, or should we ignore them?
What we need to do?
>> He Jing: That's exactly the problem we talk about,
the early registration of your trademark.
Right? The Chinese people,
they're kind of out of prospects.
They're very smart, you know?
They can smell whether your brand's going
to be popular here or not.
And they will probably keep thinking about.
You know, maybe actually your mark,
your brand already had [inaudible]
of our Chinese name maybe in Taiwan,
Hong Kong you know the Chinese greater China market.
People will do the search.
If the mark is not really introduced in China, hey,
you know those prospects probably more than happy
to register the mark first, okay, without your knowledge.
What you need to do, okay,
this is actually quite a risky situation now for you.
If you have some genuine interest in China market,
then ideally you should get some advisors, you know,
give you some advice about your potential China mark
and you register that yourself first.
Okay, that's first thing.
The second thing is for this prospect,
while if the individual's tough, but if there are companies,
you know, you hire maybe a trademark agents
and the law firm to monitor the publication
of a Chinese trademark office, okay?
If someone trying to register your mark
or the Chinese counterpart, you know,
Chinese law allows us three-month window time
for you to oppose it.
Once you oppose it, that mark will sit there
for quite a long time, okay?
So you need to have some monitoring system.
But first of all, you need to register
at least an English mark, you know, as soon as you can.
If you have not done that, you should do that immediately
and have a good coverage.
And start to think about maybe at least a transliteration
of your English mark and register that,
you know, as a Chinese name.
That's one of the things you need to look at.
But you cannot sue those people directly right now.
Okay? If they say, hey, I want to register the mark.
Even if they register your mark, you cannot sue them.
Just so you know.
Okay? But you can oppose the [inaudible] mark filing.
But that's required some monitoring activities.
>> John Zane: Thank you.
>> He Jing: Does that help, John?
>> John Zane: Helpful.
Thank you.
>> Janice Wingo: This is Janice.
Can I just make a plug here?
We also have a webinar on trademark fundamentals.
And if you shoot me an email I can send you the link to it.
It's usually posted at the stopfakes.gov website,
but I can send you a link
because we're revamping the website right now.
>> Operator: Once again if you would like to ask a question,
please press star one.
One moment.
Kathy Fyke, your line it is open.
>> Kathy Fyke: Hi, Kathy Fyke again
with Department of Commerce.
If I have a client company who registered their patent
in the US ten years ago, is it too late for them
to register their patent in China?
>> He Jing: Correct.
That's too late.
That's too late.
>> Kathy Fyke: So what other options --
how would you, if you were that company,
is there any other routes you could go
to protect your product in China?
>> He Jing: Normally this is what I would do.
The company would have probably make some effort, okay?
Have the engineer sit down again.
Ideally, ideally, you know, work with someone
who knows China market and think, hey,
this is the patent whether this product could be improved a bit,
adaptation to the China market.
And actually, you know, in China, just so you know,
we do not [inaudible].
All right, just so you know China has three types
of patents: Invention patent, that's the equivalent
to the US utility patents, right.
In China it's regarded as more sophisticated technologies
and methodologies, okay?
That covers formulas, you know, components, everything.
But there's another type
of little patent we call the utility model patents, okay?
This type of patents are registered without examination.
Okay? And it's intended to cover the sort of simple improvement
or minor improvements, especially for mechanical parts
or less, you know, complicated electronics type of patents.
Many Chinese companies using that, okay?
The cases where Schneider lost for $40 million US dollars is
because of that type of a patents.
So it's not that hard, I think, for a US company
to change something and then make it arguably some new
advantages or more utilities, more use, some more efficient
or whatever, and then file that with something new
in China [inaudible] as a utility model patents.
It's not expensive.
And that would give them a coverage.
>> Kathy Fyke: A brilliant idea, thank you.
>> Operator: Once again, if you would like to ask a question,
please press star one on your touch-tone telephone.
Once again that's star and one.
>> Janice Wingo: Anyone who's listening
to the audio recording,
Lawyer He said he'd be willing to take questions.
So just because you can't ask him live, he's still happy
to answer your questions.
And you can reach him at j-i-n-g.he
at z-y-p-a-r-t-n-e-r-s.com.
You can also call the China Desk at the Department of Commerce.
And the number is (202)482-2590.
>> He Jing: And by the way, you know,
our firm also has a very good weekly IP blog
that will provide you some very fresh information
about what's going in China.
We also have generals in terms of offering comments,
recommendations dealing with some, you know,
with IP issues in China.
So you're welcome to check our website
and sign up our newsletters.
>> Operator: And at this time I am showing no further questions.
>> Janice Wingo: Okay.
Well, Lawyer He, we'd like to thank you for your time.
I know it's quite late.
And you're not even at home.
You're in Singapore.
So you're doing this on the road.
We appreciate your time.
I just wanted to remind the listeners
that we have a presentation on April 2nd from an officer
at US Customs and Border Protection.
And she's going to explain how you can record your US
trademarks with CPB here to keep.