France’s Limagrain Wins Highest Chinese Damages Ever for New Plant Varieties Infringement – Over 53 Million RMB
On April 25, 2025, China’s Intellectual Property Court of the Supreme People’s Court (SPC) announced a verdict favoring Limagrain’s Chinese affiliate Heng XX Seed Industry Co., Ltd. against Henan Jin XX Seed Industry Co., Ltd. The SPC awarded Limagrain’s affiliate over 53 million RMB and an injunction for infringing new corn plant variety “NP01154” overturning the lower court’s decision and applying punitive damages. This is believed to be the highest ever award in China for new plant varieties infringement.
Heng XX Company filed a lawsuit with the first instance court, claiming that the seven approved corn hybrid varieties produced and sold by Jin XX Company, including “Zheng Pinyu 491”, “Jinyuanyu 304”, “Jinyuanyu 171”, “Zheng Pinyu 597”, “Jinyuanyu 181”, “Zhengyuanyu 777” and “Zhengyuanyu 887”, were all produced without permission using the “NP01154” variety as a parent, and requested that it be ordered to stop the infringement, apply punitive damages of 160 million RMB and pay 200,000 RMB for reasonable expenses for rights protection. In the first instance, Heng XX Company submitted four test reports to prove that the number of difference sites between the parents of the alleged infringing variety “YZ320” and “NP01154” was 1, and therefore was infringing; Jin XX Company submitted test report No. 2994 and claimed that there were differences in 4 of the 5 additional test sites, and the two were different varieties, so it did not constitute infringement. The first instance court accepted the test report No. 2994 submitted by Jin XX Company, determined that the parent of the alleged infringing variety “YZ320” and the authorized variety “NP01154” were different varieties, and ruled to dismiss all the claims of Heng XX Company. Heng XX Company appealed.
The focus of the second-instance dispute was whether Jin XX infringed the variety rights of “NP01154” and the determination of infringement liability, which mainly involved whether the parents (paternal parents) of the seven hybrid corn varieties accused of infringement were identical to the authorized variety “NP01154”. In particular, when using molecular markers to determine the identity of the variety, the conditions for expanding the site testing and the probative value of the additional testing results were the key issues in this case.
The Supreme People’s Court held that there was insufficient evidence to prove that the five additional test sites in the No. 2994 test report were generally recognized specific sites that could distinguish different varieties. The report’s initiation of the expanded site testing procedure and the selection of additional test sites did not comply with the provisions of the relevant judicial interpretations and the requirements of the molecular marker testing standards for new plant varieties, and had no probative value. Jin XX’s claim that its allegedly infringing variety was “glutinous” corn and that the authorized variety “NP01154” was “ordinary corn” and that the two were different varieties lacked evidence. The evidence in this case can prove that the parents (father) of the seven hybrid corn varieties accused of infringement are identical to the authorized varieties, and Jin XX’s behavior constitutes infringement of the “NP01154” variety rights; Jin XX’s company intentionally infringed, and the infringing products involve 7 approved hybrid varieties, the infringement period is as long as five years, and the infringing production area is as high as 8243.4 acres. The infringement is serious, and punitive damages should be applied, and the multiple of punitive damages is determined to be 1X, and then the total compensation is determined to be twice the amount of compensatory damages, that is, more than 53.347 million RMB. In view of the complexity of the case and the evidence, Heng XX’s attorney fees, testing fees, travel expenses and other expenses are reasonable, and the reasonable expenses of 200,000 RMB for rights protection are fully supported. The final compensation amount in this case is 53,547,163.1 RMB.
The original text of the announcement is available here (Chinese only).
Artificial Intelligence and Our Continuing Journeys in Alice’s Wonderland: Practice Points from Recentive Analytics, Inc. v. Fox Corp.
If you’re a patent practitioner who works with innovation related to artificial intelligence, you’ll want to consider the Federal Circuit’s recent decision in Recentive Analytics, Inc. v. Fox. Corp. This decision is the first to explicitly consider patent eligibility in the context of the use of artificial intelligence.
The Federal Circuit affirmed the district court’s dismissal of Recentive’s complaint, holding that the claims were not eligible under Section 101. “This case presents a question of first impression: whether claims that do no more than apply established methods of machine learning to a new data environment are patent eligible. We hold that they do not.”
This case involved patents that addressed the scheduling of live events and optimizing network maps—in particular, what programs or content are displayed by a broadcaster’s channels in different geographic markets at a particular time. The district court dismissed the patent owner’s complaint for infringement because it found the patent claims were directed to ineligible subject matter under 35 U.S.C. § 101.
In analyzing the patent claims directed to event-scheduling, the Federal Circuit noted that the claims involved collecting data, an iterative training step, and an output step in which an optimized schedule is output, and an updating step in which the schedule is updated based on new data inputs.
The extent to which the specification discussed machine learning was fairly general: that a model can be trained using a set of training data that includes historical data from previous live events, that the machine learning model can be instructed to optimize a target feature such as event attendance, revenue, or ticket sales, and that “any suitable machine learning technique” can be used.
In analyzing the patent claims directed to network map optimization, the Federal Circuit noted that the claims involved collecting data, analysis of the data to create a network map, an updating step, and a using step. The specification included some information about the training data used to train the models and also noted that any suitable machine learning technique could be used.
Notably, under Step 2A, Prong 1 of the Alice test, the Federal Circuit found that the use of generic machine learning technology in carrying out the claimed methods was a conventional technique that does not represent a technical improvement. In discussing Prong 1, the Federal Circuit noted that neither the claims nor specification described any improvement to technology but instead only disclosed that machine learning is used in a new environment. In addition, nothing in the claims discussed a transformation of machine learning techniques applied within the context of network scheduling to something significantly more than generating event schedules and network maps.
This case established two important new guideposts: (1) applying machine learning techniques to a task, in and of itself, is likely not eligible under Section 101, and (2) detail in the specification and claims about a technical problem and detail about an improvement an invention provides to address this technical problem is important. More generally, this case suggests that machine learning techniques are just another tool to perform a task, and that using machine learning is (now) a bit like using a computer to perform a task —that is, not enough to get over the 101 hurdle.
In many respects, this case follows the intellectual underpinnings of Alice Corp. v. CLS Bank Int’l, in which the recitation of a generic computer was insufficient to transform a patent-ineligible abstract idea into eligible subject matter, particularly in view of the ubiquity of computer technology in our lives. With artificial intelligence becoming more ubiquitous, it is perhaps unsurprising to see the courts suggesting that the mere use of artificial intelligence is also insufficient to transform a patent-ineligible abstract idea into eligible subject matter.
In view of Recentive Analytics, innovators and practitioners who are pursuing patents that involve the use of machine learning models to perform a task may want to focus on the underlying technical problem under the existing techniques—whether it’s computational efficiency, resource utilization, poor results, some combination of all of that, or something else—and how the invention addresses these technical problems. It may also be helpful to avoid stating in the patent application that “any suitable machine learning technique can be used.”
For applications that relate to fundamental changes to the way machine learning models work, this decision should not impact strategies for obtaining patent protection.
Michael Lew also contributed to this article.
China’s Supreme People’s Procuratorate Launches Intellectual Property Procuratorate
At an April 23, 2025, press conference, China’s Supreme People’s Procuratorate (SPP) announced the launch of the Intellectual Property Procuratorate. Li Xuehui, Director of the General Office (Public Information Office) and Spokesperson of the Supreme People’s Procuratorate, stated, “since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping as the core has elevated intellectual property protection to a national strategy. The report of the 20th CPC National Congress clearly pointed out the need to ‘strengthen the legal protection of intellectual property rights,’ which has pointed out the direction for procuratorial work in the new era. Recently, the Supreme People’s Procuratorate, after research and approval from the Office of the Central Organization and Establishment Commission, added ‘Intellectual Property Procuratorate’ to the Economic Crime Procuratorate of the Supreme People’s Procuratorate. Today’s press conference is the first time that the Intellectual Property Procuratorate of the Supreme People’s Procuratorate has appeared to the public. The formal establishment of the Intellectual Property Procuratorate of the Supreme People’s Procuratorate reflects the CPC Central Committee’s high attention to intellectual property protection and marks that China’s judicial protection of intellectual property rights has further entered a stage of professionalization and integration. “
April 23, 2025 SPP Press Conference
Initially, the SPP launched an intellectual property office in November 2020 with pilot offices in nine provinces/municipalities including Beijing, Tianjin, Shanghai, Jiangsu, Zhejiang, Fujian, Chongqing, Sichuan and Hainan.
In August 2021, the SPP stipulated that the Intellectual Property Office would be responsible for procuratorial functions of criminal, civil, administrative and public interest litigation for IP rights.
In March 2022, the SPP issues the “Opinions of Comprehensively Strengthening IP Procuratorial Work in the New Era,” clarifying the guiding ideology, basic principles, goals, tasks and specific measures for IP procuratorial work.
In June 2022, the “Mona Lisa” trademark dispute was retried and the verdict changed. This was the first IP administrative litigation supervision case that was appealed by the SPP and successfully changed since the establishment of the IP Office. As explained by the SPP in their 48th Batch of Guiding Cases Focusing on IP:
On November 11, 2021, the Supreme People’s Procuratorate lodged a protest with the Supreme People’s Court, believing that the second-instance judgment in this case contained errors in the determination of facts and application of law. The main reason is that the “bathroom (water closet), toilet” products approved for use in the disputed trademark and the “bathroom fixtures” products approved for use in the cited trademark constitute similar products. The disputed trademark and the cited trademark are similar in terms of text composition, name, constituent elements, etc., and constitute similar trademarks….The Supreme People’s Court ordered the Beijing Higher People’s Court to retry the case. On June 14, 2022, the Beijing Higher People’s Court made a judgment that the disputed trademark and the cited trademark constitute similar trademarks used on similar goods…The Beijing Higher People’s Court revised the verdict after retrial and revoked the second-instance judgment and the first-instance judgment in this case.
In July 2022, the SPP issued the “Implementation Plan for National Procuratorial Organs to Carry Out Special Supervision Work on Punishing Malicious IP Litigation.”
In January 2023, the SPP established a national IP prosecution pool with 90 members and later increased to 132 members.
By the end of 2023, all provincial level procuratorates have established IP prosecution departments.
A transcript of the press conference is available here (Chinese only). A brief history from the SPP of SPP IP prosecution can be found here (Chinese only).
Whither Discretionary Denials? Read the Tea Leaves, or Follow the Bread Crumbs? (Part II)
In Part I of this set of blogs, we discussed the impact of the rescission of former USPTO Director Vidal’s Guidance Memorandum for handling discretionary denials in inter partes review proceedings before the Patent Trial and Appeal Board. We also discussed Chief Judge Boalick’s Guidance Memorandum on the rescission.
In Part II, we examine a new interim procedure, instituted March 26, 2025, for briefing of discretionary denials. This new procedure radically changes how a patent owner whose patent is the subject of an IPR or post-grant review petition can raise discretionary denial issues prior to the PTAB’s decision whether to institute a proceeding. The new procedure bifurcates discretionary denial issues, including Fintiv issues, from merits and non-discretionary denial issues, and delegates to the USPTO Director the determination of whether to discretionarily deny a petition.
The Old Procedure
Previously, petitioners and patent owners would include discussion of discretionary denial issues as a small (sometimes very small) part of their 14,000 word limit for petition and preliminary response, with the remaining words devoted to the substantive merits or demerits of the petition. The petitioner would try to anticipate the patent owner’s arguments for discretionary denial. From time to time, the PTAB would grant the parties limited additional briefing on discretionary denial issues where, for example, the patent owner raised discretionary denial issues that the petitioner had not anticipated.
The New Procedure
Under the new interim procedure, a patent owner has 14,000 words (the same as in any IPR petition or responsive brief) to argue that discretionary denial is proper. The petitioner has 14,000 words to respond. The patent owner’s discretionary denial brief is due two months after the PTAB issues a Notice of Filing Date Accorded to the petition, and one month before the patent owner’s preliminary response (another 14,000 word paper) is due. The petitioner’s response (also 14,000 words) is due one month after the patent owner’s discretionary denial brief.
In the discretionary denial briefing, the parties are allowed to address all discretionary denial considerations as reflected in PTAB precedential decisions, including Fintiv(involving a parallel district court case), General Plastic(involving multiple petitions), and Advanced Bionics(involving previous prior art and/or arguments in the USPTO regarding the patent). The discretionary denial briefing also may include consideration of denial issues under 35 U.S.C. § 325(d).
In addition, discretionary denial considerations may include (Interim Procedure, p. 2):
Whether the PTAB or another forum has already adjudicated the validity or patentability of the challenged patent claims;
Whether there have been changes in the law or new judicial precedent issued since issuance of the claims that may affect patentability;
The strength of the unpatentability challenge;
The extent of the petition’s reliance on expert testimony (the PTAB has said that this factor is under consideration, and that guidance will be forthcoming);
Settled expectations of the parties, such as the length of time the claims have been in force;
Compelling economic, public health, or national security interests; and
Any other considerations bearing on the Director’s discretion.
The first bullet point is similar to Fintiv Factor 3 (how much work have the district court and the parties done on the validity of the claims in the IPR). The third bullet point is similar to Fintiv Factor 6 (which includes consideration of the merits of a petition). While the PTAB has not (yet) specifically commented on the fourth bullet point factor, this factor appears somewhat similar to Fintiv Factor 4 (overlap between issues raised in the petition and in the parallel proceeding).
In a recent discretionary denial of institution of an IPR petition in Motorola v. Stellar, the Acting Director found the Board erred in weighing the Fintiv factors, noting among other things that the petitioner’s invalidity expert report in the accompanying district court litigation basically repeated all of the arguments in the petition. This overlap in arguments was of concern because of the possibility that much of the work that would be done in the IPR to adjudicate validity would not alleviate the validity workload. For example, some of the invalidity positions in district court relied on prior art combinations in the IPR petition, plus some additional system art. The district court and the parties had done a lot of work on the case, having taken expert depositions and proceeded through claim construction and what appeared to be overlapping expert reports. Consequently, even though petitioner submitted a Sotera stipulation, the Acting Director denied institution.
The USPTO Director will work with three senior PTAB judges to decide whether to discretionarily deny a petition. If denied, no proceeding is instituted. If not denied, then a different PTAB panel will consider the petition on its merits, based on the petition and the patent owner’s preliminary response.
The Acting USPTO Director intends that this bifurcation of discretionary denial and merits considerations will reduce the PTAB’s workload.
No Briefing, No Discretionary Denial
At a Boardside Chat on April 17, 2025, the PTAB said that in order to have the Director decide whether to issue a discretionary denial, the patent owner must file a discretionary denial brief. Otherwise, the PTAB will proceed to determine whether to institute a proceeding on the merits. If the patent owner does not file a discretionary denial brief, the petitioner does not have to file one. Also, the Director will not address any discretionary denial factor (for example, any of the Fintiv factors) that the patent owner does not raise in its brief.
What About Merits?
At the Boardside Chat, the PTAB said that the discretionary denial briefing opportunity is not to be used for doubling up on merits briefing, even though merits consideration is one of the Fintiv factors. In the discretionary denial brief, it would be appropriate for the patent owner to comment briefly on merits — for example, to identify weaknesses in the petitioner’s case — and then refer to the forthcoming Patent Owner Preliminary Response (POPR) for more detailed discussion of the merits. Given the timing of petitioner reply to a discretionary denial brief and the POPR, it is expected that the Director will have recourse to merits briefing from both parties before deciding whether to discretionarily deny a petition. Patent owners should not necessarily count on the PTAB seeing any discussion of merits in the discretionary denial brief, so the patent owner’s preliminary response should contain all of the merits arguments that patent owners plan to make.
What About Timing?
There are two timing points of interest. One is that, if the patent owner files its discretionary denial brief before the two-month deadline, petitioner’s response deadline moves up accordingly. A second is that, if a petitioner wants to use the presence of a Sotera or a Sand stipulation as an argument against discretionary denial, the petitioner should file the stipulation within one month of the Notice of Filing Date Accorded. This early filing allows the patent owner to have a meaningful opportunity to address the stipulation in its discretionary denial brief.
What About Fee Refunds to Petitioner in the Event of Discretionary Denial?
Also at the Boardside Chat, the PTAB said that it still is discussing how to handle fee refunds in the event of discretionary denial.
What Recourse Do the Parties Have in Challenging Decisions on Discretionary Denial and/or Merits?
During the Boardside Chat, the PTAB identified three possible paths of recourse for parties to challenge institution (or non-institution) decisions:
Merits: Panel Rehearing Request
Discretionary Denial: Director Review Request
Merits + Discretionary Denial: Director Review Request
Takeaways
In addition to the items discussed here and in Part I of this blog, there have been significant resignations of APJs from the PTAB. In addition, the PTAB has been ordered to accelerate its work on appeals to the USPTO by over 40 percent. Since some PTAB judges handle both IPRs/PGRs and appeals, there will be an adverse impact on capacity to generate IPR decisions. As a result of all this, it seems likely that there will be more discretionary denials of IPR and PGR petitions going forward, and thus fewer merits decisions. In the short term at least, this approach may help with the Board’s workload. Longer term, it remains to be seen whether the increase in discretionary denials will continue as a part of Patent Office policy. A continued increase in discretionary denials could have a chilling effect on a patent infringement defendant’s willingness to file an IPR petition.
Royal Play Penalty: No Standing in the End (Zone)
The US Court of Appeals for the Federal Circuit dismissed an appeal from the Trademark Trial & Appeal Board, finding that the appellant lacked standing because it failed to allege any actual and particularized injury. Michael J. Messier v. New Orleans Louisiana Saints, LLC, Case No. 24-2271 (Fed. Cir. Apr. 14, 2025) (per curiam) (Moore, C.J.; Prost, Stark, JJ.) (nonprecedential)
Michael J. Messier claimed that he is a direct descendent of the kings of France, and that he and his family own intellectual property rights to the Fleur-de-Lis mark used by the NFL’s New Orleans Saints. Messier filed a petition with the Board for cancellation of the Saints’ Fleur-de-Lis mark. Messier’s petition contained no claim that he or his family currently use any fleur-de-lis marks in commerce or any other avenues for revenue, such as licensing. The Board dismissed the petition.
The Board held that pursuant to Sections 13 and 14 of the Lanham Act, 15 U.S.C. §§ 1063 and 1064, to maintain a cancellation action, Messier had to “allege a commercial interest in the registered mark or a reasonable belief in damage from the mark’s continued registration.” Messier’s original and amended petitions failed to do so. The Board noted that Messier did not own or conduct “any business under the mark, and thus he cannot allege entitlement.” Messier appealed.
The Federal Circuit determined that Messier lacked standing to bring the appeal. The Court explained that to demonstrate Article III standing for his appeal, Messier had to demonstrate actual or imminent injury that was concrete and particularized, a causal connection between the alleged conduct and the injury, and potential redressability by a favorable decision. Messier failed to meet his burden, primarily because he failed to demonstrate injury by the Saints’ use of the Fleur-de-Lis mark that went beyond “a general grievance or abstract harm.” Messier did not allege that he used a fleur-de-lis design in commerce whatsoever and thus failed to demonstrate any injury.
PTO Accelerates Patent Issuance Timeline
The US Patent & Trademark Office (PTO) announced that it has shortened the time between the issue notification and the issue date for patents. Historically, the time between these two events averaged about three weeks. Seeking to provide earlier protection for inventions, the PTO intends to reduce that time to about two weeks. The PTO is making the move because publishing electronic grants via the PTO online platform has allowed the PTO to eliminate redundancies and reduce the time between grant notification and the issuance date. The shortened wait time has the added benefit of potentially allowing patent applicants to avoid the Quick Path Information Disclosure Statement (IDS), which attempts to streamline filing an IDS after payment of the issue fee.
Practice Note: Given the accelerated timeline, the PTO recommends that applicants file continuation applications before payment of the issue fee to ensure codependency.
Broadcast Alert! Applying Conventional Machine Learning to New Data Isn’t Patent Eligible
The US Court of Appeals for the Federal Circuit affirmed a district court’s ruling that patents applying established machine learning methods to new data are not patent eligible under 35 U.S.C. §101. Recentive Analytics, Inc. v. Fox Corp. et al., Case No. 23-2437 (Fed. Cir. Apr. 18, 2025) (Dyk, Prost, Goldberg, JJ.)
Recentive sued Fox, alleging infringement of four patents designed to tackle long-standing challenges in the entertainment industry – namely, optimizing the scheduling of live events and refining “network maps,” which determine the content aired on specific channels across various geographic markets at set times. These patents aim to streamline broadcast operations and enhance programming efficiency.
The patents at issue can be divided into two categories: network maps and machine learning training. The machine learning training patents focus on generating optimized event schedules by training machine learning models with parameters such as venue availability, ticket prices, performer fees, and other relevant factors. The network map patents describe methods for dynamically generating network maps that assign live events to television stations across different geographic regions. These methods utilize machine learning to optimize television ratings by mapping events to stations and updating the network map in real time based on changes to the schedule or underlying criteria. The patents’ specifications explain that the methods employ “any suitable machine learning technique” using generic computing machines.
Fox moved to dismiss on the grounds that the patents were subject matter ineligible under § 101. Recentive acknowledged that the concept of preparing network maps had existed for a long time. Recentive also recognized that the patents did not claim the machine learning technique. Nonetheless, Recentive argued that its patents claimed eligible subject matter because they involve using machine learning to generate custom algorithms based on training the machine learning model. Recentive characterized its patents as introducing “the application of machine learning models to the unsophisticated, and equally niche, prior art field of generating network maps for broadcasting live events and live event schedules.”
The district court disagreed and granted Fox’s motion. Applying the Alice framework, at step one, the court determined that the asserted claims were “directed to the abstract ideas of producing network maps and event schedules, respectively, using known generic mathematical techniques.” At step two, the court determined that the machine learning limitations were no more than “broad, functionally described, well-known techniques” that claimed “only generic and conventional computing devices.” The court denied Recentive’s request for leave to amend because it determined that any amendment would be futile. Recentive appealed.
For the Federal Circuit, this case presented a question of first impression: whether claims that do no more than apply established methods of machine learning to a new data environment are patent eligible.
Step One
While Recentive claimed that its machine learning approach was uniquely dynamic and capable of uncovering hidden patterns in real time, the Federal Circuit found these features to be merely standard aspects of how machine learning operates. The Court explained that iterative training and model updates are not breakthroughs but rather are fundamental to the technology itself. Recentive conceded that its patents did not disclose any novel method for enhancing machine learning algorithms – just their routine application. Recentive also conceded that before the advent of machine learning, event planners relied on “event parameters” such as ticket sales, weather forecasts, and other data to guide scheduling decisions, a process the patents themselves acknowledge was traditionally manual and inflexible. The same is true for network maps, which were historically crafted by humans to determine content placement across channels. The Court found that Recentive’s assertion that applying machine learning to this context was more than an abstract concept and therefore rendered the claims patent eligible lacked merit. Courts have consistently held that claims that simply place an abstract idea into a new field of use do not transform it into a patent-eligible invention.
The Federal Circuit made clear that applying existing technology to a new dataset or context does not, on its own, confer eligibility. Federal Circuit precedent teaches that true innovation demands more than repackaging conventional methods within a different domain, regardless of how novel the application may seem. The Court noted that Recentive’s claim that its patents qualified merely because they incorporate machine learning into event planning and network mapping stood in direct contradiction to settled § 101 jurisprudence.
Step Two
Recentive claimed that its patents involved an inventive concept by using machine learning to dynamically create optimized maps and schedules based on real-time data, updating them as conditions changed. The Federal Circuit disagreed, affirming the district court’s decision that this merely described the abstract idea itself. The Court found nothing in the patent or the claims that added anything more to transform the abstract concept of generating event schedules and network maps using machine learning into a patent-eligible invention.
No Point in Amending
The Federal Circuit rejected Recentive’s argument that the district court should have granted leave to amend its complaint, noting that Recentive neither proposed specific amendments nor identified factual issues that would impact the § 101 analysis.
Practice Note: Recognizing that machine learning is a burgeoning and increasingly important field that may lead to patent-eligible improvements in technology, the Federal Circuit was careful to circumscribe its ruling: “Today, we hold only that patents that do no more than claim the application of generic machine learning to new data environments, without disclosing improvements to the machine learning models to be applied, are patent ineligible under § 101.”
Transatlantic Terminology: Skilled Artisan Could Equate UK, US Word Meanings
The US Court of Appeals for the Federal Circuit affirmed a Patent Trial & Appeal Board unpatentability determination, finding that a skilled artisan would have found the term “sterile” in a UK publication to mean the same as the term “sterilized” in the United States. Sage Products LLC v. Stewart, Case No. 23-1603 (Fed. Cir. Apr. 15, 2025) (Reyna, Cunningham, Stark, JJ.)
Sage owns two patents related to a sterilized chlorhexidine product in a package, such as an applicator filled with an antiseptic composition for disinfecting skin. Becton, Dickinson and Company petitioned for inter partes review (IPR) of both patents. The Board relied on four key pieces of prior art, including one that was a UK publication, to find the challenged claims unpatentable. In instituting the IPR and evaluating the petition, the Board construed the term “sterilized” to mean that “the component or composition has been subjected to a suitable sterilization process such that sterility can be validated.” In the final written decision, the Board found that a skilled artisan at the time of the invention would have known, through education and experience, that the term “sterile,” as used in the UK prior art publication, is equivalent to the term “sterilized,” as used in the US and particularly in the Sage patents. Reviewing the totality of the evidence before it, including both parties’ experts’ reports and testimony, the Board determined the challenged claims were unpatentable. Sage appealed.
The Federal Circuit declined to overturn the Board’s findings, affirming the Board’s definition of a person of ordinary skill in the art and their understanding of the term “sterilized” at the time of the invention. The Court found that the Board did not ignore or disregard evidence but properly weighed the evidence before it, concluding that a skilled artisan having the education and experience required by the Board’s definition would know the differences between the US and UK regulatory standards for “sterile” and therefore would know that UK references to “sterile” items would satisfy the challenged claims’ requirement for “sterilized” items.
EU Loses WTO Challenge Against China’s Anti-Suit Injunctions; Files Appeal
As predicted by ip fray on April 10, 2025, the European Union (EU) has confirmed on April 22, 2025 it lost the World Trade Organization (WTO) proceedings against China over anti-suit injunctions (ASIs) for standard essential patents (SEPs). The EU is appealing. In August 2020, China’s Supreme People’s Court decided that Chinese courts can prohibit patent holders from going to a non-Chinese court to enforce their patents by putting in place an “anti-suit injunction”. The Supreme People’s Court also decided that violation of the order can be sanctioned with a 1 million RMB daily fine. Since then, Chinese courts have adopted several additional anti-suit injunctions against foreign patent holders leading to the current dispute.
Per the EU,
[T]he WTO panel upheld the EU’s case by acknowledging that China has developed a policy of limiting intellectual property rights, starting with the guidelines of the Supreme People’s Court, supported by the political level and implemented by the judiciary through several court judgments. It also found that China must be more transparent by transmitting to the EU and other WTO members information on intellectual property matters, including court judgements.
However, the panel did not follow the EU’s interpretation of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement as requiring China to refrain from adopting or maintaining measures that undermine other WTO members’ implementation of the agreement in their jurisdictions. According to the panel, the TRIPS Agreement does not contain an obligation for WTO members to abstain from adopting measures that prevent other WTO members from implementing it in their own territories.
China’s Ministry of Commerce responded on April 23, 2025:
China has always attached great importance to intellectual property protection and its achievements are obvious to all. China is pleased to see that the WTO expert group supports China’s claims. China has received the EU’s appeal request and will handle it in accordance with the relevant rules of the MPIA to safeguard its legitimate rights and interests.
An additional WTO complaint filed by the EU against China continues to proceed regarding setting global royalty rates for SEPs in DS632.
The EU appeal can be found here (English) and China’s response as reported by Xinhua here (Chinese).
TOO CLASSY FOR THIS SUIT: What Two Google Rulings Say About How Not To Define A Class
Greetings CIPAWorld!
Here are some exciting case updates involving Google. What started as a headline-making copyright case against Google just became required reading for anyone litigating under CIPA. So, you may be asking, what do copyright and CIPA have in common? Don’t worry… the connection will become clear as we explore these cases. In In re Google Generative AI Copyright Litig., No. 23-cv-03440-EKL, 2025 U.S. Dist. LEXIS 75740 (N.D. Cal. Apr. 21, 2025), a class of creators claimed that Google scraped their copyrighted works without permission to train its AI models. It was pitched as a massive data appropriation lawsuit. Still, the case stumbled temporarily because, as litigators know all too well, the Plaintiffs proposed an improperly defined class.
The Plaintiffs, a group of authors, illustrators, and content creators, accused Google of using their copyrighted materials to train its generative AI models without permission. I find this fascinating! While in law school, I wrote a white paper on this topic, examining the copyright implications of using creative works to train AI systems. The intersection of copyright law and emerging technologies presents novel legal challenges.
In this case, it was a sweeping theory of unauthorized data use, but the case ran into trouble the moment plaintiffs defined their class. They limited membership to individuals “whose exclusive rights under 17 U.S.C. § 106 in their registered works were infringed upon.” In re Google Generative AI Copyright Litig., 2025 U.S. Dist. LEXIS 75740, at *6. In other words, you were only in the class if Google violated your copyright.
It may seem straightforward to target affected individuals, but the Court immediately identified the problem. The class only included those who would ultimately prevail on the merits. As such, the Court couldn’t determine who was in the class without deciding if Google was liable to each potential class member. News flash… that’s what courts call a “fail-safe” class.
Judge Lee explained that “the Court cannot determine who is a member of the class without deciding the merits of each potential class member’s claim, including whether the potential class member has a valid copyright registration, whether Google infringed the class member’s work(s), and whether Google has a valid defense based on fair use or license.” Id. at *10.
As the Ninth Circuit explained in Kamar v. Radio Shack Corp., 375 F. App’x 734, 736 (9th Cir. 2010), a fail-safe class is impermissible because membership is conditioned on a legal finding. It’s circular. Because Plaintiffs’ proposed class was tied to the elements of infringement, the Court struck the class allegations under Fed. R. Civ. P. 12(f). See Google Generative AI Copyright Litig., 2025 U.S. Dist. LEXIS 75740, at *11. Judge Lee didn’t dismiss the case outright, but she gave Plaintiffs fourteen days to amend their definition.
The Court also offered a suggestion: reframe the class based on factual criteria. The revised definition proposed by Plaintiffs, “all persons or entities domiciled in the United States who owned a United States copyright in any work used by Google to train Google’s Generative AI Models during the Class Period,” was precisely that. Id. Judge Lee acknowledged that this revised definition “would not require an upfront determination by the Court that each potential class member will prevail on the merits of an infringement claim.” Id. This makes perfect sense. That’s the difference between a procedural dead-end and a viable class.
This issue isn’t unique to copyright litigation. I mean, this is CIPAWorld, right!? Plaintiffs continue to define classes as people “whose communications were intercepted” or “whose data was unlawfully shared.” These definitions don’t identify a group of people based on facts. They identify a group based on whether they’ve already proven their claim. That’s precisely what courts are rejecting.
I saw a nearly identical issue in In re Google RTB Consumer Priv. Litig., No.: 4:21-cv-2155-YGR, 2024 U.S. Dist. LEXIS 119157 (N.D. Cal. Apr. 4, 2024) a few weeks prior. That case focused on Google’s Real-Time Bidding (“RTB”) platform. Plaintiffs alleged that the system shared sensitive user data with advertisers through real-time ad auctions. The class was defined as Google account holders “whose personal information was sold or shared.” Sounds familiar, right?
Judge Yvonne Gonzalez Rogers found the class definition flawed. Like Judge Lee, she concluded that the definition was “fail safe” because it required resolving the merits. Specifically, whether Google “impermissibly shared” personal information, just to identify who belonged in the class. The Court stated: “The Court agrees with Google that, as written, the class definition is fail safe. The question on which this suit hinges is whether Google impermissibly shared its account holders’ personal information through RTB.” Id. at *18.
But that wasn’t the only issue the court addressed. Judge Rogers also cautioned that removing the contested phrases from the class definition might broaden the class so much that it would include users who weren’t harmed. The Court stated, “Defining a class so as to avoid, on one hand, being over-inclusive and, on the other hand, the fail-safe problem is more of an art than a science.” Id. at *17.
CIPA litigators should take note. These rulings aren’t just about definitions, but they’re about strategy. If the class can’t be defined in a way tethered to objective facts, plaintiffs won’t make it to the merits. Courts aren’t guessing anymore. They’re asking: Can we identify class members without deciding if the law was broken? If the answer is no, certification won’t happen.
The RTB case also surfaced another common problem in CIPA litigation: individualized consent. Judge Rogers denied certification of a Rule 23(b)(3) damages class because determining who saw disclosures and who didn’t would require user-by-user analysis. That inquiry would overwhelm common issues.
Still, the Court acknowledged that a Rule 23(b)(2) injunctive class could be appropriate. While Plaintiffs could not satisfy the predominance requirement for a damages class, the Court noted that prospective injunctive relief might proceed under a different analysis. A forward-looking injunction targets company practices going forward and doesn’t require resolving individualized consent issues for each user. But even injunctive claims must be grounded in a well-defined, objectively ascertainable class.
Despite presenting expert evidence involving millions of RTB bid requests, Plaintiffs faced one more obstacle. The Court was not persuaded that the data set reliably reflected the experience of the proposed class as a whole. Plaintiffs alleged that advertisers could determine what content users viewed and even infer their locations. But the Court held that this wasn’t enough. The data needed to be representative of the entire class experience, and the plaintiffs hadn’t met that burden. See In re Google RTB Consumer Priv. Litig., 2024 U.S. Dist. LEXIS 119157, at *32-33.
For defense counsel, the takeaway is that challenges to class definitions and evidentiary gaps remain powerful early tools to be utilized. Whether the issue is consent variability, class overbreadth, or sampling deficiencies, these rulings reinforce that procedural missteps can and often derail class actions before the merits stage. As CIPA litigation continues to sweep across California, these two Google rulings illustrate where cases are getting stuck. Defining your class around legal conclusions, relying on non-representative data, or ignoring consent variations are no longer technical errors. They are strategic liabilities.
Whether you’re responding to claims involving chat features, embedded scripts, or real-time data flows, the foundational question remains the same: who’s in your class, and how do you know? If answering that requires proving liability, the case may never reach certification.
As always,
Keep it legal, keep it smart, and stay ahead of the game.
Talk soon!
Wyoming Joins the List of States Banning Some Noncompete Agreements
On March 19, 2025, Wyoming became one of the latest states to enact legislation banning noncompete agreements.
The new law, which goes into effect July 1, 2025, voids “[a]ny covenant not to compete that restricts the right of any person to receive compensation for performance of skilled or unskilled labor.” The law applies only to contracts entered into on or after July 1, 2025, and specifically states that nothing in the law alters, amends or impairs “any contract or agreement entered into before July 1, 2025.”
The law, as drafted, broadly applies to any agreement containing a noncompete clause, such as an employment agreement, independent contractor agreement, or some other type of agreement. The law does not impact or address non-solicitation agreements.
Though the new law appears on its face to be far-reaching, it contains notable exceptions that effectively narrow the scope of noncompetes impacted by the law, discussed below.
Trade Secret Exception
The Wyoming noncompete ban does not include covenants not to compete “to the extent the covenant provides for the protection of trade secrets as defined by W.S. 6-3-501(a)(xi).” Under W.S. 6-3-501(a)(xi), “trade secret” is broadly defined as:
the whole or a portion or phase of a formula, pattern, device, combination of devices or compilation of information which is for use, or is used in the operation of a business and which provides the business an advantage or an opportunity to obtain an advantage over those who do not know or use it. “Trade secret” includes any scientific, technical or commercial information including any design, process, procedure, list of suppliers, list of customers, business code or improvement thereof. Irrespective of novelty, invention, patentability, the state of the prior art and the level of skill in the business, art or field to which the subject matter pertains, when the owner of a trade secret takes measures to prevent it from becoming available to persons other than those selected by the owner to have access to it for limited purposes, the trade secret is considered to be:
(A) Secret;
(B) Of value;
(C) For use or in use by the business; and
(D) Providing an advantage or an opportunity to obtain an advantage to the business over those who do not know or use it.
The breadth of Wyoming’s statutory definition of “trade secret” arguably leaves employers with a fair amount of leeway to structure their restrictive covenants so that they fall under this exception.
Executive and Management Personnel Exception
The law also excludes noncompete agreements entered into with executive and management personnel and officers and employees who constitute professional staff to executive and management personnel. The law does not define the terms “executive and management personnel” or “officers and employees who constitute professional staff to executive and management personnel,” potentially providing employers relatively wide latitude in determining which employees may fit within this exception.
Physicians
The law also voids covenants not to compete in employment, partnership or corporate agreements between physicians that restrict the rights of a physician to practice medicine as that term is defined under Wyoming’s Medical Practice Act. All other provisions of a physician’s agreement that are “enforceable at law shall remain enforceable.”
Additionally, physicians will be permitted to disclose their “continuing practice of medicine and new professional contact information to any patient with a rare disorder as defined in accordance with the national organization for rare disorders, or a successor organization, to whom the physician was providing consultation or treatment before termination of the employment, partnership or corporate affiliation.” Physicians, and their new employers, shall not be liable for any damages resulting from the disclosure or from the physician’s treatment of the patient following the termination of the agreement or the physician’s employment, partnership or corporate affiliation.
Expense Repayment Provisions
Contractual provisions for recovering the “expense of relocating, educating and training an employee” are also exempt from the new law pursuant to the following statutory repayment provisions based on how long the employee has worked for the employer:
(A) Less than 2 years: Recovery up to 100% of expenses
(B) At least 2 years but less than 3 years: up to 66% of expenses
(C) At least 3 years but less than 4 years: 33% of expenses
(D) 4 or more years: 0% of expenses
Contract for the Purchase and Sale of a Business or Its Assets
Finally, the law also excludes covenants not to compete that are contained in a contract for the purchase and sale of a business or the assets of a business.
Key Takeaways
Employers wishing to enter into noncompete agreements on or after July 1, 2025 may only do so if the noncompete falls within one or more of the law’s specific carveouts. Notably, the law does not provide for any statutory damages or penalties, such as an attorneys’ fee-shifting or “loser pays” penalty, should a party choose to challenge the validity of a noncompete agreement. The law’s lack of a damages or penalties provision could potentially diminish the law’s impact as employers may perceive little risk in asserting a noncompete provision which falls under one or more of the law’s more expansive exceptions, such as the trade secret exception or executive and management personnel exception.
As Wyoming joins the growing list of jurisdictions considering and adopting legislation governing noncompetes, we will continue to report on key legislative updates and trends
China’s Supreme People’s Court Releases Typical Intellectual Property Cases in People’s Courts of 2024
On April 21, 2025, China’s Supreme People’s Court (SPC) the Typical Intellectual Property Cases in People’s Courts of 2024 (2024年人民法院知识产权典型案例). This year’s annual release includes only 8 cases and includes trade secret theft, an IP ownership dispute, copyright infringement, trademark infringement, and unfair competition. No patent infringement cases made the list this year. Typical cases are used by the SPC to promote uniformity to help ensure similar cases are treated consistently across different courts.
As explained by the SPC:
[Patent ownership dispute between Shenzhen ZhenXX Medical Technology Co., Ltd. and Shenzhen RuiXX Biotechnology Co., Ltd. and Hu]
Second instance: 最高人民法院（2023）最高法知民终871号
【Basic Facts】
Shenzhen ZhenXX Medical Technology Co., Ltd. was established in January 2018. It is a high-tech company co-founded by three entrepreneurs returning from overseas, Yu, Wang, and Hu, aiming to promote the research and development and transformation of mRNA technology in the field of biomedicine. In September 2019, Hu founded Shenzhen RuiXX Biotechnology Co., Ltd. The invention patent entitled “A mRNA based Osteoarthritis Drug Preparation and Its Preparation Method and Application” was applied by Shenzhen RuiXX Biotechnology Co., Ltd. in June 2021 and was granted in October 2021. Shenzhen ZhenXX Medical Technology Co., Ltd. filed a lawsuit claiming that the patent in question was a service invention completed by Hu during his tenure at the company. Shenzhen RuiXX Biotechnology Co., Ltd.’s application for the patent in question damaged the legitimate rights and interests of Shenzhen ZhenXX Medical Technology Co., Ltd. and requested a judgment to confirm that the patent right in question belongs to Shenzhen ZhenXX Medical Technology Co., Ltd. The court of first instance ruled to dismiss the lawsuit filed by Shenzhen ZhenXX Medical Technology Co., Ltd. Shenzhen Zhen Medical Technology Co., Ltd. filed an appeal.
[Judgment Result]
The Supreme People’s Court held in the second instance that this case involved a number of researcher returnees, a number of enterprises and institutions, and cutting-edge technologies in the field of biomedicine. Combined with the important position of mRNA technology in the field of medicine, and the fact that the three researchers had worked closely together, returned to China to start a business together, and made important contributions to the research and development of innovative drugs involving mRNA technology, it determined the trial ideas of “mediation first” and “untie the knot of emotions first, then the knot of law”. Through field investigations, circuit trials, and active mediation work, the parties were encouraged to sign a package settlement agreement on this case and other related lawsuits, which resolved the contradictions and series of disputes between the two parties for more than two years, and promoted the two parties to work together to return to cooperation on the cutting-edge track in the field of biomedicine, achieving win-win, multi-win, and win-win results.
【Typical significance】
The case was heard in public on “National Constitution Day” by a five-member panel headed by Tao Kaiyuan, Vice President of the Supreme People’s Court and Second-Level Justice, and was reported by nearly 40 media outlets. The mRNA technology involved in this case is a key common technology and cutting-edge high-tech in the field of biomedicine, and is a typical representative of new quality productivity. The substantive resolution of this case and related litigation disputes further released the clear orientation of the people’s courts to encourage innovation, promote integrity, respect science, and respect talents, which is conducive to scientific researchers’ courage to innovate and start businesses with peace of mind, better stimulate the innovation and creativity of the whole society, and promote the integrated development of scientific and technological innovation and industrial innovation.
Case 2. Trademark infringement and unfair competition in the real estate sector
[Dispute over trademark infringement and unfair competition between RenXX Land (Chengdu) Co., Ltd., Shanghai RenXX Real Estate Co., Ltd., Nanjing RenXX Enterprise Management Co., Ltd., Singapore RenXX Holdings Co., Ltd. and Lanzhou RenXX Real Estate Co., Ltd.]
Second instance: 最高人民法院（2023）最高法民终418号
【Basic Facts】
In 1993, RenXXLand (Chengdu) Co., Ltd. and Shanghai RenXX Real Estate Co., Ltd. were established. In 1994, Nanjing RenXX Enterprise Management Co., Ltd. was established. Since 1995, the above companies have launched real estate projects in Shanghai, Nanjing, Chengdu and other places, and have been approved to register multiple “RenXX” trademarks in multiple categories such as construction services. In January 2002, Jin, the legal representative of Lanzhou RenXX Real Estate Co., Ltd., purchased real estate developed by Shanghai RenXX Real Estate Co., Ltd. in Shanghai. Lanzhou RenXX Real Estate Co., Ltd. was registered and established on November 26, 2002, and began to use the “RenXX” corporate name, and successively developed and constructed RenXX International, RenXX Meilin County, and RenXX Jingcheng real estate projects in Lanzhou. RenXX Land (Chengdu) Co., Ltd. and others believed that the above-mentioned actions of Lanzhou RenXX Real Estate Co., Ltd. constituted trademark infringement and unfair competition, and thus filed a lawsuit. The court of first instance ruled that Lanzhou RenXX Real Estate Co., Ltd. should stop infringing trademark rights and engaging in unfair competition, compensate RenXX Land (Chengdu) Co., Ltd. and other companies for economic losses and reasonable expenses totaling RMB 13,405,992.3, and publish a statement to eliminate the impact. Lanzhou RenXX Real Estate Co., Ltd. appealed.
[Judgment Result]
The Supreme People’s Court held in the second instance that although Lanzhou RenXX Real Estate Co., Ltd. only used the alleged infringing logo in Lanzhou, considering the similarity between the alleged infringing logo and the four trademarks involved, the degree of relevance between the services and goods used, the popularity of the “RenXX” trademark, the actual use of Lanzhou RenXX Real Estate Co., Ltd., and the actual confusion that has occurred, it can be determined that the alleged infringing behavior of Lanzhou RenXX Real Estate Co., Ltd. is likely to cause confusion among the relevant public and constitute an infringement of trademark rights. Based on the use of the “RenXX” trademark by Shanghai RenXX Real Estate Co., Ltd. and others, including the fact that the legal representative of Lanzhou RenXX Real Estate Co., Ltd. had purchased a property developed by Shanghai RenXX Real Estate Co., Ltd. and was aware that Shanghai RenXX Real Estate Co., Ltd. had used the “RenXX” trademark first, it can be determined that the “RenXX” trademark constitutes a prior trademark with a certain influence. As a peer operator, Lanzhou RenXX Real Estate Co., Ltd. should have given way to the competition, but it still registered and used the “RenXX” brand name to engage in the same business activities as Shanghai RenXX Real Estate Co., Ltd., which easily led the relevant public to believe that the real estate projects it developed and constructed had a specific connection with Shanghai RenXX Real Estate Co., Ltd., etc. The above-mentioned behavior of Lanzhou RenXX Real Estate Co., Ltd. constituted unfair competition. The second-instance judgment dismissed the appeal and upheld the original judgment.
【Typical significance】
This case involves the protection of corporate name rights and trademark rights in the field of commercial housing development and construction. There are currently a large number of such disputes. This case clarifies common issues such as trademark use, likelihood of confusion, and fair use in trademark infringement in the field of commercial housing, and clarifies the review criteria and proof standards for the protection of competitive interests of corporate names in Article 6, Item 2 of the Anti-Unfair Competition Law of the People’s Republic of China. The judgment in this case includes the circumstances where the infringer is aware of the prior use of the name by others in the determination of “names with a certain influence”, conveying the judgment concept of protecting honest business and maintaining fair competition order.
Case 3. Infringement of trade secrets of undisclosed characters in a “spoiler” game
[Dispute between Shanghai MiXX Technology Co., Ltd. and Chen on infringement of trade secrets]
First instance: 上海市浦东新区人民法院（2024）沪0115民初38294号
【Basic Facts】
Shanghai MiXX Technology Co., Ltd. is the operator of a certain game and has obtained the permission of the copyright owner of the game to use and protect the rights. Since its launch, the game has aroused enthusiastic response in the global game market. During its operation, Shanghai MiXX Technology Co., Ltd. updates the version every once in a while, adding new characters, scenes, plots, activities and other content to maintain game attention and the vitality of the product. These contents will undergo internal testing in advance. To this end, Shanghai MiXX Technology Co., Ltd. and its affiliated companies recruited a number of players including Chen to participate in the internal testing and signed a confidentiality agreement. During Chen’s participation in the internal test, he secretly photographed and recorded the actual images (i.e. the images of the game characters that can be controlled by players), skill effects, skill data and other test content and pictures of the seven game characters involved in the game “Zhi XX” without permission, and disclosed them to third parties many times. After discovering this, Shanghai MiXX Technology Co., Ltd. filed an application for pre-trial behavior preservation (injunction) with the People’s Court on the grounds that the relevant information was a trade secret and further disclosure would cause irreparable damage to it, and filed a lawsuit within the statutory period, requesting an order to stop infringement, eliminate the impact and compensate for losses. Chen argued that the above-mentioned game content did not constitute a trade secret.
[Judgment Result]
The Shanghai Pudong New Area People’s Court reviewed the application for pre-litigation behavior preservation and held that the request of Shanghai MiXX Technology Co., Ltd. had factual basis and legal basis, and that failure to take corresponding preservation measures might cause irreparable damage to the legitimate rights and interests of Shanghai MiXX Technology Co., Ltd., and that taking behavior preservation measures would not lead to a significant imbalance of interests between the parties. Therefore, within 48 hours after receiving the application, the People’s Court of Pudong New Area of Shanghai made a ruling in accordance with the law, ordering Chen not to disclose, use, or allow others to use the game content that he had recorded without authorization during the game test.
The Pudong New District People’s Court of Shanghai held at first instance that the continuous dynamic game screens composed of elements such as the actual image of the characters, the effects of the characters’ skills, and the skill data of the seven game characters involved in the game met the business information characteristics and business secret constituent elements stipulated in the Anti-Unfair Competition Law, and were business secrets protected by the law. Chen violated the confidentiality obligation and secretly filmed and disseminated these business secrets, and should bear the corresponding legal responsibility. The essence of business secret protection is the competitive advantage that business secrets bring to operators. Even if the game characters have been made public due to version updates, Chen is still not allowed to disclose the test game screens that he may have. Therefore, Chen was ordered to stop the infringement, eliminate the impact, and compensate for economic losses and reasonable expenses totaling 500,000 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case involves the criteria for determining and adjudicating trade secrets based on undisclosed character designs and other information in the game, which is of positive significance for promoting the healthy development of the gaming industry. The pre-litigation behavior preservation ruling, combined with the characteristics of the online gaming industry, provides timely legal relief to the applicant. The judgment targets the situation of game character leakage, not only protecting the content of the game character itself, but also protecting the business model that increases attention through game version updates, as well as the competitive advantage brought by this business model, thus providing strong regulation on the behavior of early “spoilers”.
Case 4. “AI face-swapping” copyright infringement case
[Dispute between Chen XX and Shanghai Yi XX Network Technology Co., Ltd. over infringement of the right to disseminate information on the Internet]
First instance: 上海市嘉定区人民法院（2024）沪0114民初1326号
【Basic Facts】
Chen XX used the real-name authentication account “Photographer XX” on the Douyin (TikTok) platform to post 13 short videos of women wearing ancient costumes, each about 10 seconds long. Shanghai YiXX Network Technology Co., Ltd. developed the Douyin mini program “XXyan”, which uses AI video synthesis algorithms to provide users with face-swapping technology. The 13 short videos displayed on “XXyan” and the 13 short videos posted by Chen only differ in the facial features of the characters, while the video scenes, lenses, character modeling, and movements are basically the same. “XXyan” users can replace the faces in the videos displayed on the mini program with their own faces and save them by watching advertisements or purchasing memberships. Chen filed a lawsuit, requesting that Shanghai YiXX Network Technology Co., Ltd. be ordered to stop the infringement, apologize, and compensate for the loss of 48,000 RMB and reasonable expenses of 2,000 RMB.
[Judgment Result]
The Jiading District People’s Court of Shanghai held at first instance that the original video shot by Chen XX reflected original selection and arrangement in terms of content arrangement, scene selection, shooting angle, etc., and was an audiovisual work protected by copyright law. The video involved in the case displayed by the “XXyan” mini program was synthesized by partially replacing the original video through AI algorithms, and the two are substantially similar. Shanghai YiXX Network Technology Co., Ltd. used “AI face-swapping” as a selling point, provided platforms, materials and technologies, and enabled users to use the original video in a “face-swapping” manner at any selected time and place to seek commercial interests, infringing on Chen’s right to disseminate information on the Internet. This behavior is neither an original adaptation nor a fair use, nor does it apply to the technical neutrality defense. Shanghai YiXX Network Technology Co., Ltd. actively cooperated in the litigation to delete videos, perform algorithm filing procedures and other rectification behaviors, and accepted judicial suggestions on the use of algorithm technology to provide network services, and made a commitment to standardize operations. Chen XX expressed understanding and withdrew his request to stop infringement and apologize. Based on this, Shanghai YiXX Network Technology Co., Ltd. was ordered to compensate Chen XXfor economic losses and reasonable expenses totaling 7,500 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case is a typical dispute in the application scenario of generative synthesis algorithms, involving the nature of the use of artificial intelligence technology to partially synthesize other people’s works. The judgment in this case clarified that “AI face-swapping” does not constitute an original adaptation and fair use of the original work; those who use artificial intelligence technology to provide network services have a reasonable duty of care and may not use algorithmic technology to infringe on the copyright of others. This case balances technological innovation and rights protection, and clarifies the legal boundaries of the application of artificial intelligence technology. The people’s courts focus on the innovative application of emerging technologies and the needs of algorithm governance, urging companies to strengthen the legality review of material sources and generated content and algorithm security assessments, strengthen the protection of intellectual property rights and personal rights, and guide companies to standardize digital transformation.
Case 5. Game “skin-changing” infringement case
[Copyright infringement and unfair competition dispute between Chengdu LeXX Technology Co., Ltd., Shanghai LiXX Network Technology Co., Ltd. and Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd.]
Second instance: 广东省高级人民法院（2023）粤民终4326号
【Basic Facts】
“Awakening XX” is a war strategy simulation game (SLG), developed and operated by Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd. “XX Official” is a WeChat platform mini-program game, developed and operated by Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd. From December 2020 to March 2022, the revenue of the game “XX Official” was approximately 18.9 million RMB, and after deducting the corresponding channel fees, it was approximately 12.5 million RMB. Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd. filed a lawsuit, believing that the “skin-changing” behavior of the game “XX Official” constituted copyright infringement and unfair competition, and requested an order to stop the infringement, publish a statement to eliminate the impact, compensate for economic losses of 10 million RMB and reasonable rights protection costs of 500,000 RMB. After comparison, the overall structure and gameplay system of the two games are basically the same, and the parameter types, specific values, and interactive relationships of the game elements all have one-to-one correspondence, and even a large number of text expressions are completely consistent. The only difference is the art and audio-visual materials. The court of first instance determined that the alleged acts constituted copyright infringement and ordered Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd. to immediately stop developing, operating and promoting the “XXX” game, publish a statement to eliminate the impact, and compensate for economic losses of 10 million RMB and reasonable rights protection costs of 500,000 RMB. Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXXTechnology Co., Ltd. appealed.
[Judgment Result]
The Guangdong Provincial High People’s Court held in the second instance that copyright law protects the original expression of game play rules. The game structure, system, numerical planning and corresponding relationship requested for protection in this case belong to the game play mechanism design, reflecting all the ideas of the game developers for the virtual game world from details to the whole, and are not expressions in the sense of copyright law. Game play rules do not constitute “other intellectual achievements that meet the characteristics of works”, so the accused behavior does not constitute copyright infringement. However, the accused behavior violates the principle of good faith and business ethics, and exceeds reasonable limits to imitate and copy the overall classification framework of game play design to the details of numerical settings. It only simply replaces the art resources, diverts and seizes the market share of related games through this “skin-changing” method, disrupts the market competition order, and seriously damages the core competitive interests of Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd., constituting unfair competition. The first-instance judgment found that the facts were clear, and although the application of the law was improper, the judgment was correct. The second-instance judgment dismissed the appeal and upheld the original judgment.
【Typical significance】
This case clearly states that game play rules do not belong to expressions in the sense of copyright law and should not be considered as “other intellectual achievements that meet the characteristics of works.” The judgment clarifies the legal boundaries, analytical framework, and adjudication rules for copyright law and anti-unfair competition law to protect game play, which will help promote innovation, creation, and healthy competition in the digital entertainment industry.
Case 6. Unfair competition case of online evaluation with “some criticizing and some praising”
[Unfair competition dispute between Wuxi ShiXX Clothing Co., Ltd., Wuxi JiuXX Trading Co., Ltd. and Suzhou BuXX E-commerce Co., Ltd., Suzhou XiXX E-commerce Co., Ltd., Suzhou XiXX Network Technology Co., Ltd., and Suzhou KuXX Network Technology Co., Ltd.]
Second instance: 江苏省苏州市中级人民法院（2023）苏05民终5492号
[Omitted as it relates to false advertising and not IP]
Case 7. Unfair competition case involving ticket grabbing software
[Dispute over unfair competition on the Internet between Beijing DaXX Culture Media Development Co., Ltd. and Zheng XXzhong]
First instance: 北京市东城区人民法院（2024）京0101民初4607号
【Basic Facts】
Beijing DaXX Culture Media Development Co., Ltd. is a large domestic comprehensive ticketing platform enterprise, operating DaXX.com and DaXX APP with ticketing functions. Zheng XXzhong sells ticket grabbing software for Damou APP through online stores. Beijing Damou Culture Media Development Co., Ltd. filed a lawsuit, claiming that Zheng XXzhong specially developed and sold plug-in software for its ticketing APP to grab tickets on sale on the APP, which constituted unfair competition, and requested that Zheng XXzhong be ordered to stop the infringement and compensate for economic losses and reasonable expenses. Zheng XXzhong argued that he did not have a competitive relationship with Beijing DaXX Culture Media Development Co., Ltd., and he was only the seller of the ticket grabbing software involved in the case, not the developer. His behavior of selling ticket grabbing software did not cause a reduction in the ticketing revenue of Beijing DaXX Culture Media Development Co., Ltd., nor would it affect the public ticket purchasing order, and did not constitute unfair competition.
[Judgment Result]
The Beijing Dongcheng District People’s Court held at first instance that Zheng XXzhong provided ticket grabbing services to users of Beijing DaXX Culture and Media Development Co., Ltd., and used the business activities and user base of Beijing DaXX Culture and Media Development Co., Ltd. as the basic resources for its own business. Therefore, the alleged behavior was a market competition behavior and fell within the scope of regulation of the Anti-Unfair Competition Law. The essence of the alleged behavior was that software replaced manual methods to help users grab tickets for performances on the DaXX platform. This behavior not only directly increased the operating costs of the platform and interfered with the operator’s correct business decisions, but also increased the difficulty for users to use the DaXX platform to buy tickets, and reduced users’ evaluation of the services provided by the DaXX platform. Although the alleged behavior did not directly reduce the ticket sales revenue of a single performance on the DaXX platform, it caused damage to the operating interests and goodwill of the DaXX platform and damaged the competitive interests of Beijing DaXX Culture and Media Development Co., Ltd. At the same time, the alleged behavior did not belong to fair competition in technological innovation, and also damaged the legitimate rights and interests and long-term interests of consumers, which was not conducive to the fair and orderly market competition order and the improvement of overall social welfare. In summary, the alleged behavior constituted unfair competition. Since the alleged behavior has been stopped, no separate judgment is made to stop the infringement, and Zheng XXzhong is ordered to compensate Beijing DaXX Culture Media Development Co., Ltd. for economic losses and reasonable expenses totaling 20,000 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case clearly points out that the ticket grabbing software involved in the case uses technical means to provide users with unfair advantages in ticket grabbing, undermines the platform’s ticket purchasing rules, interferes with and hinders the normal operation of the platform’s ticket sales business, and damages the competitive interests of specific operators. On this basis, the consumer’s fair ticket purchasing rights and the normal order of the ticket market are taken into consideration, and it is determined that the alleged behavior constitutes unfair competition. This case warns ticket grabbing service practitioners and technology developers to abide by legal rules, which has positive significance for combating online black and gray industries, safeguarding the legitimate rights and interests of operators and consumers, and building a fair and orderly ticket purchasing order and market competition environment.
Case 8. Criminal and civil lawsuit involving copyright infringement of popular film and television works
First instance: 浙江省东阳市人民法院（2024）浙0783刑初585号
【Basic Facts】
Since May 2020, the defendant Lu XXqian has built multiple illegal film and television websites by purchasing domain names, renting servers, purchasing system programs and film and television website templates. During this period, the defendants Ji XXshi and Fang XX knew that the defendant Lu XXqian was operating an illegal film and television website and still sold him the film and television navigation Content Management System program and multiple film and television website templates, and provided program technical maintenance services, charging more than 6,990 RMB. Without the permission of the copyright owner Beijing Guang XX Film Co., Ltd. and other rights holders, Lu XXqian added more than 120,000 film and television works such as “YOLO” and “Pegasus 2” on the website by adding video links, etc., for visitors to watch online, and cooperated with illegal advertisers to place advertisements on the website. From April 30, 2022 to February 15, 2024, the defendant Lu XXqian collected more than 1.48 million RMB in advertising fees. The People’s Procuratorate of Dongyang City, Zhejiang Province accused the defendants Lu XXqian, Fang XX, and Ji XXshi of copyright infringement and filed criminal charges. During the criminal proceedings, five companies including Beijing GuangXX Film Co., Ltd. filed a supplementary civil lawsuit, requesting that Lu XXqian be ordered to bear corresponding civil liability.
[Judgment Result]
The Dongyang People’s Court of Zhejiang Province held at first instance that the defendant Lu XXqian, for the purpose of profit, disseminated other people’s audiovisual works to the public through the information network without the permission of the copyright owner, and the illegal income was huge; the defendants Fang XX and Ji XXshi knew that others infringed the copyright and still provided assistance, and their actions also constituted the crime of copyright infringement. In response to the incidental civil lawsuits filed by the plaintiffs of the incidental civil lawsuits, the defendant Lu XXqian was determined to compensate the plaintiffs of the incidental civil lawsuits for economic losses by taking into account the nature, time, and profit of the defendant’s infringement. The defendant Lu XXqian was sentenced to four years in prison and a fine of 1.5 million RMB; the defendant Fang XX was sentenced to one year in prison, suspended for one year and six months, and fined 16,000 RMB; the defendant Ji XXshi was sentenced to ten months in prison, suspended for one year and four months, and fined 10,000 RMB; the defendant Lu XXqian compensated the plaintiffs of the incidental civil lawsuits for economic losses totaling 880,000 RMB; the illegal income was returned and seized crime tools were confiscated. After the verdict, none of the defendants or plaintiffs in the ancillary civil lawsuit filed an appeal, and the procuratorate did not file a protest.
【Typical significance】
This case is an example of severely punishing the illegal and criminal acts of broadcasting key protected cinema films during the Spring Festival. Pirated broadcasts of popular TV series and movies, the establishment of illegal and irregular film and television websites, and the dissemination of related film and television works to the public through information networks involve infringement of the copyright of film and television works. The trial of this case fully reflects the advantages of the “three-in-one” trial mechanism of civil, criminal, and administrative intellectual property rights, which not only solves the problems of conviction and sentencing of the defendants, but also solves the problem of civil compensation for the victims, and provides timely and comprehensive protection for intellectual property rights holders, achieving the organic unity of combating crime and efficiently safeguarding rights.