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).

Episode 14

Even if a trademark or design is not registered, it is possible to seek an injunction or damages for infringement under the Unfair Competition Prevention Act.
However, while the hurdle for proving the requirements for an injunction or damages under the Unfair Competition Prevention Act is high, the existence of a trademark right or design right, which requires registration with the Japan Patent Office, is proven by registration. Furthermore, in a claim for damages, intent or negligence is also presumed.
In a lawsuit (Tokyo District Court, 2018 (Wa) No. 26166, judgment dated November 30, 2020), in which a design right holder for a "prefabricated house" filed a lawsuit alleging that the defendant's actions constituted an infringement of the design right and a violation of the Unfair Competition Prevention Act, the violation of the Unfair Competition Prevention Act was not found, but the infringement of the design right was found.
In a lawsuit filed by the owner of the registered trademark "Bike Lifter" for the designated product "transport dolly for motorcycles" alleging that the defendant's actions constituted infringement of the trademark right and violation of the Unfair Competition Prevention Act (Osaka District Court, 2015 (Wa) No. 547, judgment dated January 19, 2017), the violation of the Unfair Competition Prevention Act was not found, but the infringement of the trademark right was acknowledged.
In order for a product to be considered an "indication of goods, etc." under Article 2, Paragraph 1, Item 1 of the Unfair Competition Prevention Act, 1) the shape of the product must have objectively distinctive features that are different from other similar products (particular distinctiveness), and 2) the shape must have been used exclusively by a specific business for a long period of time, or the product must have become well-known among consumers as an indication of the source of a specific business through extremely powerful advertising or explosive sales performance (well-knownness) (Intellectual Property High Court, 2012 (Ne) No. 10069, judgment dated December 26, 2012).
The Unfair Competition Prevention Act imposes a high hurdle for proving the existence of rights, so if you fail to register a trademark or design right, it may become difficult to exercise your rights.

Episode 13

There is a debate about whether or not applied art should be subject to overlapping application of design rights and copyright.
The conventional view was that for applied art to be protected as a work of authorship, it was not enough for the expression to be recognized as creative, but that it also needed to have a level of artistic appreciation that could be considered equivalent to pure art.
However, in the Intellectual Property High Court ruling of 2014 (Ne) No. 10063 on April 14, 2015, the court ruled that "applied art, like other works of expression, may be recognized as creative and copyrightable if the expression shows some individuality of the creator, but it is difficult to imagine that this would lead to restrictions on its use and distribution in the general public that would prevent the realization of practical or industrial purposes." and thus granted protection to applied art as a work of authorship.
The court also acknowledged the overlapping application of the Copyright Act and the Design Act, stating that "Copyright Act and Design Act have different aims and purposes (Copyright Act, Article 1; Design Act, Article 1), and there is no explicit relationship in which one of them applies exclusively or preferentially, and the application of the other is impossible or subordinate, and it is difficult to find any rational basis for such an interpretation."
This Intellectual Property High Court ruling is a precedent. A "precedent" is a ruling that contains a legal opinion that should be applied to other cases, and merely stating the reason for the sentence in the case in question is not a precedent (Supreme Court, Case No. 3474 of 1951 (A), Decision of the First Petty Bench of February 12, 1953, Criminal Collection, Vol. 7, No. 2, p. 211). This is a Supreme Court precedent in a criminal case, but in a civil case, merely stating the reason for the amount of compensation is not a precedent.
Regarding the interpretation of Article 102, paragraphs 2 and 3 of the Patent Act (presumption of the amount of damages, etc.), there is the judgment of the Grand Council case of the Intellectual Property High Court, Case of 2018 (Ne) No. 10063 on June 7, 2019. In this judgment, the amount of profit received by the infringer is the amount of marginal profit obtained by deducting additional expenses required from the sales amount of the infringing product. Furthermore, the rate to be received for the implementation in this case was determined taking into consideration the statistical average royalty rates in recent years in the technical field of each patent in question. In other words, this judgment is a court case that merely indicates the reason for the amount of compensation, and is not a precedent. Nevertheless, it is abnormal that it is a Grand Council case. One year and four months after this Grand Bench judgment, the presiding judge (the Chief Justice of the Intellectual Property High Court) was promoted to the President of the Takamatsu High Court.