Case management procedures report

Prior to trial, parties are required to exchange written statements of the factual witnesses they intend to call. At trial, the Court will hear both parties’ submissions as well as their witness testimonies. The plaintiff, being the party that initiated proceedings must prove their case against the defendant.

For civil matters that are of the monetary amount of HKD$1 million or more, an appeal from the Court of Appeal to the Court of Final Appeal lies as of right. Additionally, appeals also generally lie as of right from a ruling in a Court of First Instance judgment to the Court of Appeal. The Court of First Instance acts as an appellate court for the district court and other tribunals.

However, the appellate courts will usually only consider questions of law, and will not decide on questions of fact. It is only when there is a blatant mistake of fact when appellate courts may reconsider the facts found in lower courts.

g. Costs/Sanctioned Offers

A Court’s decision on costs will also be affected by whether or not parties reasonably rejected sanctioned offers. Sanctioned offers are settlement proposals whereby parties may pay sums into court throughout the proceedings, offering to settle the case for those amounts. If the receiving party rejects an offer and fails to do better at trial, then the Court has discretion to award costs against that party as well as penalizing them with interest, up to 10%, on any judgment awarded.

The reformed civil litigation procedures place a heavy emphasis on alternative dispute resolution, particularly mediation. Nowadays, prior to litigating in court, parties are obligated to make a good faith attempt at considering mediation as a means of alternative dispute resolution. As an added incentive to promote mediation, parties are assured that all communications during the mediation process are “without prejudice” and are protected by privilege. However, if a case is appropriate for mediation and a party does not attempt mediation, the court may award costs against the successful party after trial if it considers that the refusal to mediate was unreasonable.

Additionally, arbitration is also often encouraged by Hong Kong’s courts, but the courts may only refer parties to arbitration if the litigating parties mutually consent to arbitration or if there exists an underlying contract containing an arbitration clause. Provided that either of the aforementioned conditions are satisfied, the court will likely stay the litigation proceedings in favor of arbitration which may be conducted on an ad hoc basis or administered by a recognized arbitral institution situated in Hong Kong, such as the Hong Kong International Arbitration Center or the International Chamber of Commerce.

3. Criminal Proceedings & Customs Enforcement

Apart from civil litigation, trademark infringement also constitutes a criminal offense under the Trade Descriptions Ordinance which broadly prohibits the use of false trade descriptions, as well as the use of misleading and unauthorized trademarks. A party enforcing their right under this ordinance may request the Commissioner of the Customs and Excise Department to take enforcement action and seize the infringing goods. The Customs and Excise Department (“Customs”), has powers to search, seize, remove or detain any goods that they reasonably suspect to be an infringing good.

To request Customs to take enforcement action against trademark counterfeiting activity, the trademark owner should making a complaint to the department and provide the following information:

1. 
   relevant trademark certificate as proof of trademark ownership in Hong Kong;
   
2. 
   a sample of the genuine product and information on the offending goods involved;
   
3. 
   name and address of the suspected offender; and
   
4. 
   an appointment letter, whereby the trademark owner authorizes an officer to take enforcement action, including conducting seizure identification, giving evidence and testifying in court.
   

The litigation process in intellectual property-related lawsuits in Japan has been considerably expedited in the past 10 years as a result of the efforts made by courts, legislators and practitioners under the overall judicial system reform that started in the late 1990s. The average duration of trials in the first instances has been shortened from 25 months in 1998 to 13.4 months in 2009 (12.5 months in 2006) whereas the counterpart in the second instances have been reduced more slowly but kept under 10 months or less. Behind these improvements are the new Code of Civil Procedure entered into force in 1998, amended in 2003, and in particular the introduction of keikaku shinri or planned proceedings mandated by Article 147bis and 147ter of this law.

1. 
   Trial on the Merits
   

The new CCP has enabled a trademark owner and/or its exclusive licensee to bring an action by choice to either a district court of jurisdiction or the Tokyo or Osaka District Court depending on whether the primary jurisdiction would fall within the eastern or western part of Japan. Both district courts have specialized intellectual property departments as with the Intellectual Property High Court established in 2005 as the center of the judicial system reform. An appeal against the ruling made by a district court shall be brought to the IPHC if further deliberations would require specialized knowledge and expertise. This report will not discuss appeal proceedings in the IPHC, however.

The general principle of the new CCP is provided for in Article 2 to read “(t)he court shall endeavor to conduct civil proceedings fairly and expeditiously; the interested parties shall perform civil proceedings in good faith.” Keikaku shinri seeks to organize the proceedings systematically by setting a timetable and scheduling the respective periods during which to 1) narrow down points of dispute and evidence, to 2) examine witnesses and the other party, and to 3) close oral arguments and render a judgment. To secure speedy processing, Article 157 further enables the court to restrain submission of new claims and defenses if they are presented in an untimely manner. Where necessary, the court can change the plan in consultation with both parties pursuant to Article 147ter(4). While keikaku shinri is carried out at the initiative of the court, it may be possible only in cooperation with the parties involved.

Under these initiatives, the Osaka District Court prepared case management models in 2000 and has since managed the proceedings accordingly whereas the Tokyo District Court announced “Proposals on Management of Intellectual Property Litigation” in the same year and has complied therewith. The ODC’s Case Management Model for Design, Trademark and Unfair Competition Matters, as amended in 2004, anticipates the period starting from filing a complaint to handing down the court’s opinions on infringement (liability) to be 160 days and sets intervals between phases of the litigation process accordingly. The flow of the model proceedings and intervals in trials on the merits are shown below:

↓

Day 1 Filing a Complaint

Submitting evidentiary materials (gazette, trademark register, goods bearing registered mark, material on fame, prior negotiation documents, etc.)

↓

30 days 1^st Oral Argument in Open Court

Plaintiff: Oral statement of complaint

Defendant: Oral statement of answer

Plaintiff: Required to submit evidence of fame in 30 days

Defendant: Required to submit allegedly infringing products

Required to submit relevant documents in 60 days

Required to prepare arguments against infringement

in 30 days

↓

60 days 1^st Preparation for argument

Plaintiff: Completing evidence of fame

Defendant: Submitting 1^st brief on dissimilarity of marks, distinctive parts, etc.

Preparing evidentiary materials

↓

90 days 2^nd Preparation for Argument

Plaintiff: Submitting 1^st brief

Defendant: Completing evidentiary materials

↓

120 days 3^rd Preparation for Argument

Plaintiff: Supplementing arguments and evidentiary materials

Defendant: Supplementing arguments and evidentiary materials

↓

160 days 4^th Preparation for Argument

Court: Finalizing preparation of arguments

2^nd Oral Argument in Open Court

Court: Opinions on infringement (liability) →Conclusion Settlement

-------------------------------------------------------↓---------------------------------------------------------------------

Deliberations on damages

10 days Plaintiff: Preparing arguments, requesting defendant’s

submission of document and appraisal of damages

20 days Defendant: Denial and counterargument; preparation of

evidence (balance sheets, invoices, etc.)

↓

190 days 3^rd Oral Argument in Open Court

Defendant: Submitting additional documents

The ODC requests both parties to prepare adequately for litigation before a complaint is filed. This is facilitated by Articles 132bis to 132quater of the CCP, which allow the prospective plaintiff and defendant to mutually request information that will obviously be necessary in the intended litigation, provided that the subject matter of the litigation has been substantially communicated between the two parties in advance.

The courts in Japan have predominantly bifurcated the infringement and damages phases of the trial by initially considering infringement of trademark rights. According to the model of the ODC, the court and the parties will convene for a total of four times to determine facts, points of disputes and evidentiary materials relating to infringement after the first oral hearing and before the second oral hearing. In this phase of the litigation process, typological classification of arguments that have been made during this phase of the past similar proceedings assists the court in expediting the deliberations.

The typical points of claim to be made by the plaintiff may be broken down as below.

1. 
   Ownership of plaintiff’s registered mark
   
2. 
   Defendant’s use of a mark for particular goods
   
3. 
   Similarity between the two marks
   
4. 
   Similarity between the designated goods and Defendant’s goods
   
5. 
   Damages
   

1. 
   Invalidity of plaintiff’s registered mark
   
2. 
   Use of Defendant’s name, generic mark or descriptive mark
   
3. 
   Honest concurrent use
   
4. 
   Use of Defendant’s registered mark
   
5. 
   Tacit license agreement
   
6. 
   Abuse of trademark rights
   
7. 
   Parallel importing
   

If it is decided that infringement has occurred and the complaint included damages as well, then the court will proceed to decide whether or not and/or to what extent damages have been caused by the act of infringement on the basis of the claims and counterclaims as substantiated by evidence.

While negligence on the part of the infringer is a requirement for claiming damages, negligence shall be presumed under the Trademark Law. In addition, since it is extremely difficult to establish the causal relation between the act of infringement and lost earnings on the part of the plaintiff, the Trademark Law was amended in 1998 to alleviate the burden of proof by allowing trademark owners to claim damages based on the number of infringing products sold by the defendant, to be multiplied by the profits that would have been gained by selling the plaintiff’s goods.

At the request of the plaintiff, the court may also order that the defendant submit documents necessary to quantify the damages caused. Furthermore, the court may entrust qualified appraisers with the quantification of the damages. If it remains difficult, the court can decide a reasonable amount of damages on the basis of the whole oral proceedings and examination of evidence.

Pursuant to Article 89 of the CCP, the court may seek to facilitate settlement between both parties regardless of the phases of the proceedings they are in. According to the statistics of November 2008, forty-four (44) percent of intellectual property-related lawsuits had been settled in court whereas only thirty-four (34) percent had gone to trial. Although the timing of settlement in court varies from case to case and in some cases parties may be urged to consider acceptable terms of possible settlement at the first oral hearing, it seems most likely that the court will discuss possible settlement after the points of dispute have been clarified.

When a settlement is reached, the court proceedings are terminated and the settlement terms will be put on record, which shall have the same effect as a final ruling of the court. According to a research conducted by a judge of the Tokyo District Court, the rate of settlement in trademark cases in favor of plaintiffs is ninety-five (95) percent. This seems to show that settlement is more important in trademark enforcement matters than in other civil proceedings and that plaintiffs as well as defendants are highly motivated to settle matters amicably.

2. 
   Provisional Injunction
   

3. 
   Alternative Dispute Resolution
   

According to the statistics available on the website of JIPAC, trademark matters account for twenty-two (22) percent of all the 107 intellectual property-related mediation and arbitration cases entrusted to JIPAC in the past 12 years. Mediation, arbitration and consultation processes provided by JIPAC are closed to the public and managed by two mediators or arbitrators appointed from the list of candidates consisting of lawyers, patent attorneys and academics specialized in IP matters. In ninety-five (95) percent of the above 107 cases, mediation was chosen as a possible

In general terms, Korean judges have always taken an active role in the management of cases according to the Korean Civil Procedure Act (hereinafter the KCPA). Section 136 of the KCPA, dating back to July 1960 established the active intervention of courts to clarify pleadings by parties as well as setting forth limitations. Therefore, judges in civil proceedings of first instance are able to seek information and facts about the case from the parties. To clarify facts or pleadings, a presiding judge has the authority to take suitable measures ordering the submission of answers to questions formulated or explanations of facts to clarify issues.

The KCPA was amended in 2001. With the New Case Management Model in operation at Korean Courts since March 2001 and the New Civil Procedure Act from July 1, 2002, a major improvement in civil proceeding has been achieved. According to Youngjoon KWON, “the amendments focus on enhancing the efficiency by requiring timely measures of the party at each phase of proceedings and minimizing the number of hearing dates supported by substantial pre-trial pleadings⁶”.

Typically, Republic of Korea has two distinct proceedings (judicial and administrative) related to Intellectual Property matters: judicial courts, which include civil cases and criminal cases and Intellectual Property’s Administrative Courts, which include Intellectual Property Tribunal and the Patent Court of Korea which manage appeals against administrative decisions rendered by the Korean Intellectual Property Office (KIPO).

The judgments of civil courts can be revised by High Courts (Appeal Courts). The judgments of the Intellectual Property Tribunal can be reviewed by the Patent Court of Korea.

The judgments of High Courts and the Patent Court of Korean only can be reviewed by the Supreme Court of the Republic of Korea.

It should be clarified that the Intellectual Property Tribunal and Patent Courts of Korea have jurisdiction in cancellation proceedings, validation or invalidation of rights.

Civil and Criminal courts have exclusive jurisdiction in relation to all the infringements cases regarding Patents, Trademarks and Copyright.

The civil proceedings begin when a plaintiff or his attorney at law files a complaint with a District Court, a Branch Court, or a Municipal court.

A complaint is a written document containing the plaintiff’s allegations and it is the requirement sine qua non to start a civil proceeding. In principle, a complaint is necessary to initiate the civil proceeding except in the cases of Small-claim cases which we will explain after. A complaint must contain identity of the parties, the relief sought as purpose of the claim, the facts and the evidence (which does not need to be included or enclosed in the complaint, despite this is recommended because it can facilitate the court and the defendant to clarify claims).

The purpose of an action can be a performance claim, a declaratory claim or a formation claim which create or modify a legal relationship by order of the court.

b. Formal Proceeding

According to the Section 254 of the KCPA, the presiding judge shall conduct the plaintiff to amend or correct the requirements failed or formal mistakes within the designated time. If a complaint amends them or the formal complaint has met the requirements, the court serves the defendant with a duplicate of the same and requires him/her to file a written answer within 30 days. “If the defendant fails to file a written answer within the cited time limit, the court may render a judgment without hearings/pleading. If the defendant submits a written answer, the court holds the pleading process (proceeding whereby both parties, in writing, enter an offense and defense on allegations and evidence) and the hearings (proceedings hereby both parties appear before the court to clarify their respective positions on disputed issues as well as to examine witnesses)⁷”.

The plaintiff as well as the defendant can be represented by an attorney before the court. When the amount of the litigation does not exceed 50,000,000 Won (approximately US$ 51,000), the Court allows that parties can be counseled by a person who is not attorney at law.

After filing the complaint and the defendant responds, the preparatory stage before the trial initiates. In this stage, the presiding judge has discretionary power to require the parties to submit documents, evidence or information needed to clarify relevant facts.

With the New Case Management model, there are now one or two hearings instead of five or six under the old procedure.

e. Pre-Trial Conference

As last step of the Pre-trial proceeding, the presiding judge can hold a pre-trial conference. During the conference, the judge, together with the parties, tries to better understand the facts and discusses how and when the hearing will be performed. The presiding judge acts as a conductor of the proceeding and has authority to order procedural matters, may ask questions to the parties, gives the opportunity to submit expert opinions and added evidence, etc. The judge can give a recommendation to come to a settlement if he considers appropriate to find a mutual solution to the parties.

As mentioned before, evidence may not be submitted with the complaint but, in general, each party usually submits documents to the other party together with the factual and legal grounds it intends to rely on. The cited documents do not require any attestation or legalization.

Each party can orally argue their claims before the Court.

This system was recently introduced in July 2007 with the amendments to the Civil Code. It is supposed to enhance the quality of the proceedings and resulting judgments in areas which require skilled professionals in technical disputes involving construction, medical and intellectual property rights issues. The view point of the Korean Supreme Court is that Expert Commissioners will be able to advise a fair and neutral viewpoint based their professional qualification and expertise to the trial.

The judge renders a decision after the Hearing phase and deliberation. On time limits, the KCPA suggests a judge renders a decision within five (5) months after the institution of the lawsuit, and within two (2) weeks after the conclusion of hearing of the parties.