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Tengfei SHI
Chinese Patent Attorney
Chemistry & Biotechnology Department
Linda Liu & Partners

I. Basic Information of the Case
 
Title of the Invention: Bacterial Cellulose Gel Face Pack
 
Patent Number: 200610075040.8
 
Filing Date: March 29, 2006
 
Date of Announcement of Grant of Patent: February 13, 2008
 
Patentee: Zhong Chunyan
 
Petitioner: Hainan Nata de Coco Industry Association
 
Date of Filing of the Invalidation Request: November 24, 2011
 
Date of Issue of the Invalidation Decision: August 2, 2012
 
Invalidation Decision No.: WX19154
 
II. Foreword
 
The Invalidation Decision involves three main aspects: 1. whether the petitioner was qualified to file an invalidation request; 2. whether the description disclosed the invention sufficiently; and 3. whether the patented invention possessed an inventive step.
 
The second and third aspects relate to the questions of whether the implementation of the technical solution needed to rely on the support of experimental data and whether the invention of the patent concerned possesses an inventive step over a combination of prior art and common general knowledge. Such questions have already been thoroughly discussed in the patent industry and thus will not be explained here.
 
The first aspect relates to the qualifying as a petitioner. Invalidation cases seldom involve such an issue. The author will analyze this example of the issue in detail, and hopes that this article can be educational.
 
 
III. Case Summary
 
On November 24, 2011, the petitioner Hainan Nata de Coco Industry Association filed an invalidation request against the Chinese invention patent number “ZL200610075040.8”, called “Bacterial Cellulose Gel Face Pack”, asserting that the patent did not comply with Article 26.3 and Article 22.3 of the Chinese Patent Law.
 
The patentee argued that the patent concerned indeed complied with Article 26.3 and Article 22.3 of the Chinese Patent Law, and alleged that the petitioner was not qualified to file an invalidation request.
On August 2, 2012, the Patent Reexamination Board issued the No. 19154 Invalidation Decision, ruling that “Hainan Nata de Coco Industry Association is qualified to file an invalidation request, but the grounds of invalidation of the petitioner are unacceptable, so the validity of the patent right is maintained.”
 
 
IV. Qualification of Petitioner
 
1. Patentee’s Argument
 
Regarding qualification of the petitioner, the patentee submitted the following counterevidence:
 
Counterevidence 2: “Letter on disqualification of Hainan Nata de Coco Industry Association as a petitioner for requesting invalidation of the patent called Bacterial Cellulose Gel Face Pack” (Qiong Gong Xin Consumption Letter [2012] No. 148) issued by Hainan Provincial Industry and Information Technology Department on March 23, 2012, with two attachments: Counterevidence 2-1: “Draft Resolution” of Hainan Nata de Coco Industry Association; Counterevidence 2-2: “Meeting Minutes” of Hainan Nata de Coco Industry Association on September 28, 2011;
 
Counterevidence 3: “Letter on disqualification of Hainan Nata de Coco Industry Association as a petitioner for requesting invalidation of the patent called Edible Cellulose Produced by Fermenting Coconut Juice, Production Method thereof and Bacterial Cellulose Gel Face Pack” (Qiong Gong Xin Personnel Letter [2012] No. 218) issued by Hainan Provincial Industry and Information Technology Department on April 20, 2012, with two attachments: Counterevidence 3-1: “Expertise Report” (Hainan Company Law (Imprint Inspection) Document No. [2012060]); Counterevidence 3-2: Power of Attorney of the petitioner;
 
Counterevidence 4: Notification of Rectification Order (Qiong Min Gai [2012] No. 1) issued by Hainan Provincial Department of Civil Affairs on April 23, 2012.
 
The patentee also submitted “Important Activity Registration and Reporting System of Hainan Nata de Coco Industry Association”, “Management System of Hainan Nata de Coco Industry Association”, “The First Board of Directors of Hainan Nata de Coco Industry Association”, “Major Events of Each Year of Hainan Nata de Coco Industry Association” and “Constitution of Hainan Nata de Coco Industry Association” to prove that the draft resolution of Hainan Nata de Coco Industry Association does not conform to its rules.
 
In the patentee’s opinion, ① the petitioner (Hainan Nata de Coco Industry Association) is a “social organization legal person” which was supervised by the Hainan Provincial Industry and Information Technology Department; Counterevidence 2 provided by Hainan Provincial Industry and Information Technology Department mentions that the resolution of Hainan Nata de Coco Industry Association is invalid because it was not reported beforehand; ② Hainan Nata de Coco Industry Association does not have a legitimate qualification as a petitioner for invalidation; ③ the request for invalidation of the patent concerned by Hainan Nata de Coco Industry Association is not for a legitimate purpose and violates Article 4 of the Regulations for Registration and Management of Social Associations (promulgated by the China State Council Order No. 250 on September 25, 1998); ④ the department in charge had already ordered Hainan Nata de Coco Industry Association to make a rectification and restricted it from doing any activity in the name of a legal person; ⑤ two counterevidences 2-1 and 2-2 in Counterevidence 2 show that the filing of the invalidation request was not agreed upon by the whole Hainan Nata de Coco Industry Association.
 
The patentee concludes that Counterevidences 2-4 and other materials prove that Hainan Nata de Coco Industry Association did not  qualify as a subject able to initiate civil litigation.
 
2. Petitioner’s Argument
 
The petitioner presented the original copy of the registration certificate of Hainan Nata de Coco Industry Association, which disclosed that the validity period of this association was from August 24, 2007 to August 24, 2012.
 
In the petitioner’s opinion, (1) Hainan Nata de Coco Industry Association, which was established on August 24, 2007 and remained valid till August 24, 2012, had an independent registration certificate as a social organization legal person and was qualified to file an invalidation request; when the Hainan Nata de Coco Industry Association did not violate any law or regulation, the Hainan Provincial Department of Civil Affairs, as the organ for the issuance of the certificate, had no right to interfere in the activities of the association; thus the letters of Hainan Provincial Industry and Information Technology Department did not have a corresponding legal force; (2) the patentee had no right to raise doubts about the internal decision-making process of Hainan Nata de Coco Industry Association - only the association members had the right to do so; therefore, Hainan Nata de Coco Industry Association did qualify as a petitioner for invalidation.
 
3. Opinion of Patent Reexamination Board
 
In the Board’s opinion, the certificate of registration as a social organization legal person submitted by the petitioner discloses that its validity period was “from August 24, 2007 to August 24, 2012”, which shows that the Hainan Nata de Coco Industry Association remained a valid entity during that period. According to law, during this period the Hainan Nata de Coco Industry Association, as a social organization legal person, had civil right capability and civil liability capability granted by the law and could take part in civil litigation activities adapted to its capabilities. As for the formality, the invalidation request and the power of attorney submitted by the petitioner were stamped with the official seal of “Hainan Nata de Coco Industry Association”, so the petitioner Hainan Nata de Coco Industry Association complied with the requirement on “Eligibility as a Petitioner for Invalidation” under the Guidelines for Patent Examination.
 
The documents such as the constitution of the association mentioned by the petitioner are internal rules of the association, which only have a binding effect on members of the association – not on non-members. In the event of a third party having an objection against a resolution of the association, the party concerned could only have a discussion about it with the association or it could have requested the court to judge whether the resolution of the association had legal effect. The decision of the association registration department or department in charge on the resolution does not affect the effectiveness of the resolution made by Hainan Nata de Coco Industry Association as an independent social organization legal person based on its civil litigation capability. Therefore, the patentee’s argument is unacceptable.
 
4. Analysis of Qualification as Petitioner for Invalidation
 
Pursuant to Article 45 of the Chinese Patent Law, starting from the date of announcement of the grant of the patent right by the patent administration department under the State Council, any entity or individual that considers that the grant of said patent right is not in conformity with the relevant provisions of this Law, may request the Patent Reexamination Board to declare the patent right invalid.^[1]
 
The expression “any entity or individual” here refers to any entity or individual that enjoys civil rights and bears civil liability, which may be a Chinese entity or individual, or a foreigner, foreign enterprise or other foreign organization without habitual residence or business office in China.
 
As shown above, the legislation in China defines a broad range for the petitioner for invalidation, and only imposes a general limitation - “any entity or individual”. The word “individual” here means a natural person. According to the legislation principle and the doctrines of the Civil Law, the word “entity” here should be construed as any entity including a legal person organization and a non-legal person organization. Although in practice most of the petitioners for invalidation are interested parties with some relationship to the patents that they have requested to be invalidated, the law does not require that the “entity or individual” as a petitioner be an interested party to the patent which is to be invalidated. In judicial practice, as long as the relevant entity or individual files an invalidation request according to the relevant legal procedures, the relevant authority (i.e., the SIPO) must accept and examine the invalidation request.
 
As regards the patent concerned, although the patentee questions the qualification of the petitioner and submits counterevidences as well as other materials to prove that the petitioner is not qualified to file an invalidation request, the materials such as the association constitution mentioned by the patentee are internal rules of the association, which only have a binding effect on members of the association and not on non-members. Where a concerned party has an objection against a resolution of the association, the party  may only have a discussion with the association or request the court to judge whether the resolution of the association is effective. Any decision on the resolution by the association registration department or department in charge could not affect the effectiveness of the resolution made by Hainan Nata de Coco Industry Association as an independent social organization legal person based on its civil litigation capability. Therefore, Hainan Nata de Coco Industry Association was the qualified as a civil litigation subject.
 
In the following the author will make a further analysis about the concept “petitioner for invalidation”.
 
First of all, both an accused infringer as an interested party and a non-interested party may file an invalidation request. In practice, many invalidation requests accepted by the Patent Reexamination Board are filed by the defendants in infringement litigation.^[2] The accused infringer responds to the accusation of infringement made by the patentee by filing an invalidation request.
 
Further, pursuant to the Guidelines for Patent Examination, the patentee himself may file an invalidation request against his own patent. Such cases indeed exist in practice. There are probably many reasons why such a phenomenon exists. Firstly, in China, there is no correction procedure after the grant of a patent. If the patentee finds that the patent document has errors or defects, the patentee cannot eliminate them by making a correction. Thus, if it is indeed necessary to make amendments, sometimes the patentee will choose to voluntarily request partial invalidation of a patent right so that the patent right may be made more stable by narrowing the scope of protection of the patent right ^[2]. Secondly, there might be a dispute about the ownership of the patent. If the patentee is likely to lose control of his own patent to another party, then the patentee might voluntarily request its invalidation.
 
In the Guidelines for Patent Examination (2010), the following restrictive conditions are prescribed for cases where the patentee files an invalidation request against his own patent: first, it is only possible to request partial invalidation of the patent , instead of the whole patent; second, the submitted evidence must be publications instead of other types of evidences; third, where the patent is a joint patent, the invalidation request should be jointly filed by all the patentees, instead of only one or some of the patentees. If the invalidation request filed by the patentee against his own patent does not comply with the above provisions, the Patent Reexamination Board will not accept the invalidation request. ^[3]
 
What is the purpose of these restrictive conditions? The author has the following opinion.
 
(1) Regarding the restriction that the patentee can only request invalidation of partial patent right instead of the whole patent
 
It is abnormal for the patentee to request invalidation of the whole patent. The patentee files a patent application for the purpose of protecting the inventive technology and enjoying an exclusive right to the patented invention, in order to guarantee his own legal rights and have a competitive advantage. At the same time, the patentee can license other persons to exploit his own patent and obtain a reward, and thus enjoy the economic benefits brought by his own patent. If the patentee requests invalidation of the whole patent, the patent will be invalidated from then on, and the patentee will lose his exclusive and monopolistic advantages. Such a consequence is obviously against the initial intention to file a patent application. Furthermore, if a patentee wants to abandon a whole patent, the only thing that it needs to do is not to pay the annual fee. Denying the effectiveness of one patent through an invalidation request is both costly and time-consuming, and choosing this “non-economic” way to abandon the whole patent is contrary to common sense and will waste social resources. Perhaps the reason why a patentee does so is that the patent requested to be invalidated should have belonged to another person. Under this circumstance, the invalidation of the patent will damage the other person’s interests. Thus, the Guidelines for Patent Examination imposes a restriction on the invalidation of the patentee’s own patent, for the purpose of preventing the patentee from abusing the patent invalidation system, preventing a waste of social resources, and protecting the legal right of the real patentee when there is an ownership dispute.
 
(2) Regarding the restriction that the patentee can only use publications as evidences to request invalidation of his own patent
 
If the patentee asserts that the patent has been publicly sold before the filing date, it is difficult for other persons, and sometimes even the Patent Reexamination Board, to determine the authenticity of such a kind of evidence. If a patentee was allowed to use such a kind of evidence, then there is a large possibility that the patentee will use evidence and present relevant facts. When evidence and facts submitted by a party are disadvantageous to the party itself, they are usually accepted by the Patent Reexamination Board. As a result, evidence of a patentee’s own public use such as public sale can easily be used to invalidate a patent. If there is a dispute about the ownership of the patent, then the interests of the real patentee will be damaged. Thus, the Guidelines for Patent Examination restricts the type of the evidence that can be used by the patentee in requesting invalidation of his own patent. Only publications can serve as evidence, and the authenticity of such evidence is usually not questionable. No matter what intention the patentee has, the use of the evidence publicly published in the domestic or foreign publications before the filing date to invalidate partial patent right is both fair and reasonable, and the real patentee will not suffer from unnecessary damages.
 
(3) If the patent is a joint patent, the petitioner for invalidation must be all of the patentees. If such a restriction did not exist, then when there is a conflict between joint patentees, some patentees might maliciously invalidate the patent, thereby damaging the right of the other patentees and causing confusion in patent management.
 
 
V. Conclusion
 
According to the above analysis, the Chinese Patent Law explicitly prescribes that any entity or individual (including the patentee) may file an invalidation request. Moreover, the restrictive conditions on  invalidation requests filed by a patentee against his own patent under the Guidelines for Patent Examination are there for practical purposes.
 
VI. Afterword
 
The patent  was finally regarded by the Patent Reexamination Board as being valid. The patent  won the 11th Excellent Chinese Patent Prize and has been listed in the National Scientific and Technological Support Plan. The patented product has now been industrialized and exported to many countries and regions such as Korean, Japan and Taiwan. It is a successful example demonstrating that the Nata de Coco industry in China has for the first time transferred from the food field to the non-food field, the patent effectively improves the additional values of coconut, further upgrades the coconut industry, and explores new fields and industries to which coconuts can be applied. Therefore, the question of whether the patent was valid had an important influence on the Nata de Coco industry in China.
 
VII. References
 
[1] The Chinese Patent Law (2008);
 
[2]    Understanding Chinese Patent Law, Yin Xintian, P469, March 2011;
 
[3]    Guidelines for Patent Examination (2010), Part IV, chapter 3, section 3.2.
 

（2014）