Episode 17

Intangible property rights (intellectual property rights) include rights to creations that are the result of human mental activity and rights to goodwill (Basic Jurisprudence 3: Property, p. 281, "Intangible Property Rights" by Nakayama Nobuhiro).
 Creations that are the result of human mental activity include patent rights, utility model rights, and design rights. Rights to goodwill include trademark rights.
 Unlike patent rights, etc., infringers can avoid liability for damages by asserting and proving that no damages were caused as a defense against claims for damages from trademark holders based on Article 38, paragraph 2 of the Trademark Act (Supreme Court, 1994 (O) No. 1102, 3rd Petty Bench Judgment, March 11, 1997, Minshu Vol. 51, No. 3, p. 1055).
 In other words, trademark rights do not protect the trademark itself, but the goodwill embodied in the trademark, so even if a trademark is registered, that alone does not allow the rights to be exercised. The Supreme Court has the following commentary on this matter:
 "Rights such as patent rights and utility model rights must be considered differently from trademark rights. In other words, patent rights and utility model rights themselves have creative value, and the infringing goods utilize the patent rights in their performance, utility, etc., so a portion of the sales of the infringing goods necessarily corresponds to the value of the patent rights. Furthermore, the sale of an infringing product means that there is a demand for products that implement the patent rights, and the fact that infringing goods are being sold in the first place can be said to mean that there is a demand for the establishment of licenses to the patent rights.
 In contrast, trademark rights do not have creative value in themselves, and only have a certain value when linked to the business credit of the company or other entity from which the product originates. In other words, the fact that a product bearing a trademark is sold does not immediately mean that the trademark has contributed to sales, nor does the sale of a product mean that there is a demand for a license to use the trademark." (Same judgment, Supreme Court Case Commentary, Civil Cases, 1997 (Part 1) (Page 370)
Trademark rights cannot be exercised unless two requirements are met: the trademark is registered with the Patent Office, and the trademark is actually in use and has established goodwill in the business.

Episode 16

It has been pointed out that the Stockinette Knitting Machine Case (Supreme Court, Grand Court Decision, Case No. 28, 1967 (Gyo-Tsu), March 10, 1976; Minshu Vol. 30, No. 2, p. 79) and the Chetwa Case (Supreme Court, Third Petty Court Decision, Case No. 37, 1988 (Gyo-Tsu), April 23, 1991; Minshu Vol. 45, No. 4, p. 538) are in contradiction. If they are in contradiction, it is a question of which is the principle and which is the exception.
The Supreme Court's previous ruling was that "since the original trial is a trial of facts, it is not illegal for the parties to newly assert in the lawsuit facts that were not asserted at the time of the trial or facts that the trial court did not use as the basis for its decision" (Supreme Court, Second Petty Court Decision, Case No. 745, 1951 (O), October 16, 1963; Shumin No. 10, p. 189).
"As far as the issues in this trial are concerned, even at the litigation stage, new factual allegations are not unacceptable as a method of attack or defense." (Supreme Court, 1958 (O) No. 567, Dec. 20, 1960, Third Petty Court, Minshu Vol. 14, No. 14, p. 3103)
"In a lawsuit to set aside a decision in an invalidation trial for a registration, it is not possible to argue for reasons for invalidating the registration that are separate from the violation of the provisions in dispute, but...it is not appropriate to limit the scope of the trial to the determination of specific matters on which the decision was based or whether there was any illegality in the process of making that determination." (Supreme Court, 1964 (Gyo-Tsu) No. 62, Apr. 4, 1968, First Petty Court, Minshu Vol. 22, No. 4, p. 816)
In the Stockinette Knitting Machine case, the above precedents were changed for the following reasons.
In an action to set aside a decision in a trial for invalidation of a patent, the assertion of invalidity in comparison with a specific publicly known fact and the assertion of invalidity in comparison with other publicly known facts are considered to be separate litigation matters. Furthermore, the scope of the effect of the prima facie case (Article 167 of the Patent Law) of a final trial decision is limited to requests for trial based on the same facts and the same evidence, which is considered to give the final trial decision the effect of prima facie case against the world on the matters actually determined therein, so it is appropriate to limit the scope of the trial to the specific matters actually determined in the trial decision. (Reference: Supreme Court Case Commentary, Civil Cases, 1976, p. 37)
In contrast, in the Chetowa case, the fact of use of the registered trademark in an action to set aside a trial decision for non-use cancellation is a matter of the timing of the proof for the same litigation matter, and as a principle, it is permitted up until the conclusion of oral argument in the trial on facts. (Reference: Supreme Court Case Commentary, Civil Cases, 1991, p. 253)
From the above, the Chetowa case is the principle, and the Stockinette Knitting Machine case is the exception.

Episode 15

The Kilby decision (Supreme Court, 1998 (O) No. 364, April 11, 2000, Third Petty Bench, Minshu Vol. 54, No. 4, p. 1368) ruled that the infringement court can determine whether or not there is a reason for invalidation of a patent, and that if there is a reason for invalidation, a claim for injunction or damages based on the patent right is an abuse of rights and is not permitted.
Subsequently, Article 104-3, paragraph 1 of the Patent Act was enacted, allowing the infringement court to determine the validity of a patent, not just when the reason for invalidation is "clear." In an infringement lawsuit, if the patent is "deemed to be invalidated by a patent invalidation trial," the patent owner cannot exercise his or her rights.
This has created a so-called "double track" situation in which a decision on the validity of a patent can be made through two routes: the "invalidation trial route (invalidation trial, trial to set aside the trial decision, and appeal)" and the "infringement lawsuit route (infringement lawsuit, appeal trial, and appeal trial)."
Even if the judgment on the validity of a patent differs between the first instance judgment of an invalidation trial and the first instance judgment of an infringement lawsuit, if an appeal trial of an infringement lawsuit and a lawsuit to set aside the trial decision are pending at the Intellectual Property High Court at the same time, the cases are assigned to the same department, resulting in consistent judgments at the Intellectual Property High Court and preventing discrepancies in judgments between the two routes, the infringement lawsuit route and the invalidation trial route (https://www.jpo.go.jp/resources/shingikai/sangyo-kouzou/shousai/tokkyo_shoi/document/seisakubukai-28-shiryou/01.pdf).
We will look at recent court cases that fall into the above case.
In an infringement lawsuit (Tokyo District Court, Case No. 25121 of 2019 (Wa), Judgment dated December 9, 2021), the court dismissed the claim on the grounds that although the invention implemented by the defendant was within the technical scope of the patent in question (Patent No. 6538097), the patent in question was invalid due to a cited invention (JP Patent Publication No. 2015-102994). The appeal court (Intellectual Property High Court, Case No. 10008 of 2022 (Ne), Judgment dated November 29, 2022) also dismissed the appeal for the same reasons.
The defendant (appellee) in the above infringement lawsuit requested an invalidation trial (Invalidation 2019-800106) of the above patent right (Patent No. 6538097) based on the same cited invention (JP Patent Publication No. 2015-102994), but the request was denied. The defendant then filed a lawsuit to set aside the decision (Intellectual Property High Court Case No. 10027 of 2021 (Gyo-Ke), Judgment of November 29, 2022), but the request was dismissed for the same reason.
The above appeal (Intellectual Property High Court Case No. 10008 of 2022 (Ne) Judgment of November 29, 2022) and the lawsuit to set aside the decision (Intellectual Property High Court Case No. 10027 of 2021 (Gyo-Ke), Judgment of November 29, 2022) were decided on the same day by the same court. Despite this, there is a discrepancy in judgment between the infringement lawsuit route and the invalidation trial route. In particular, the above-mentioned appeal court decision is an illegal decision that violates "when it is deemed that a patent should be invalidated by a patent invalidation trial" (Article 104-3, Paragraph 1 of the Patent Act). Looking at the judgments in both cases, it cannot be said that either case was sufficiently examined, and they simply ratified the judgment of the first instance district court and the judgment of the Japan Patent Office Trial and Appeal Division.
On July 1st of this year (2024), a celebration was held for Patent Attorney Day, and the Chief Justice of the Intellectual Property High Court was invited as a guest. There, he gave a speech saying, "We aim to be a court that is fast, cheap, and convenient." This "convenient" does not mean convenient for users. It means convenient for those who run the court. In other words, it means that cases are processed from right to left without being examined thoroughly. The above court case is a typical example. The current Intellectual Property High Court is dysfunctional, contrary to the purpose of its establishment (Article 1 of the Intellectual Property High Court Establishment Act).