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Practice Notes

Notable changes affecting Korean trademark practice in early 2021

The Korean Intellectual Property Office (KIPO) has made a number of updates to the Trademark Examination Guidelines, Similar Goods Examination Guidelines, and Trademark Act Enforcement Rules effective from January/February 2021. The most noteworthy changes are summarized below: Similar Goods Examination Guidelines: Class 09 software descriptions [From Jan 1 2021] Until now, KIPO has allowed the designation of broad terms such as “software” and “application software for smart phones” in Class 09. However, given the reality that the purpose or scope of most software is quite limited in practice, allowing such broad coverage has resulted in a crowded register with new applications for software marks often being blocked by senior marks which are actually used for software with an entirely different purpose. For these reasons, and considering industry opinion and examination guidelines in other jurisdictions such as the US, KIPO will now require the specific function of software to be specified in applications filed on or after January 1, 2021. Software descriptions will now be broadly classified either as (i) system software, (ii) game software, or (iii) application software. In determining similarity between different software types, game software will be considered different to system/application software, while the similarity of system and application software will be decided on a case-by-case basis. Software may also be deemed similar to directly related services, though this will only apply when the marks are identical or very similar. One example is that an application for “software for screen golf games” (Class 09) would be deemed similar to an identical or very similar mark covering “operation of screen golf facilities” (Class 41), but not to a mark covering the more general “leisure sport services” (Class 41). Trademark Examination Guidelines: Non-traditional marks [From Jan 1 2021] Reflecting an increase in trademark applications for various kinds of trade dress, the updated Trademark Examination Guidelines contain a number of notable revisions relating to non-traditional trademarks, aimed at improving examination quality: 3D trademarks Formal recognition that solid and dashed/dotted lines can be used to indicate claimed and non-claimed parts of a 3D trademark. Store design trademarks (“interior/exterior of a place at which goods are sold or services are provided”) are now classified as a distinct type of 3D mark, and specific guidelines pertaining to their examination are included for the first time. Incidental parts of a store design which the applicant does not wish to claim rights in (such as windows or other building materials) may be indicated with dashed/dotted lines, so long as consistency in the overall appearance is maintained. Like other 3D marks for product packaging etc., store design marks will be essentially considered as having weak distinctiveness, and so showing evidence of acquired distinctiveness will be required to achieve registration. Non-traditional trademarks, particularly 3D trademarks, will be examined more strictly for functionality in order to avoid granting potentially unlimited trademark rights in elements which should be protected under patent. This will in practice comprise a check of (i) whether a relevant patent or utility model exists, (ii) whether there have been advertisements etc. directed to the functionality of the product, (iii) whether an alternative form exists, and (iv) the ease and economic feasibility of such alternative forms. Position/color trademarks The definition of a position trademark has been expanded from simply “shapes/figures which have acquired distinctiveness when used in a particular position on a product” to now include “colors” when used in a particular position. This will potentially allow for registration of marks where the use of a specific color in a specific location of a product acts as a source-identifier, as per some well-known examples in other jurisdictions such as the Christian Louboutin red-soled shoe (US Reg. No. 3361597) and Prada red tab sneakers (EU TM No. 001027747): US Reg. No. 3361597 EU TM No. 001027747 The description of the specific shade for color trademarks (and color position marks) has also been expanded from just Pantone to now include Hex, RAL, RGB, CMYK, KS A 0062 etc. Trademark Examination Guidelines: Foreign-language trademarks [From Jan 1 2021] For trademarks containing text in a foreign language (i.e. not Korean), such text has until now been treated as a readable word part if represented using the ‘English’ alphabet, Chinese characters, or Japanese hiragana/katakana. Such parts could then be compared with senior marks in terms of pronunciation etc., while text in other languages/scripts was treated as a graphical symbol/device for the purposes of examination. This list has now been clarified to cover text in English language, languages using the Latin alphabet (French, German, Spanish etc.), Chinese (traditional or simplified), Japanese (hiragana/katakana) etc., and a further exception has been added to include text in any other language if the pronunciation/meaning is well-known among consumers. Trademark Act Enforcement Rules: Various [From Feb 1 2021] Among the numerous minor revisions to the Enforcement Rules, the following are likely to be of most interest to foreign applicants: The number of drawings/photographs which must be submitted when applying for a 3D mark has been amended from “2 to 5” to “1 to 5”, allowing for submission of a single drawing/photograph if it allows the mark to be clearly represented. This brings Korea into line with other jurisdictions such as the US, EU and Japan which also allow for a single drawing. (Movement and hologram trademarks will still require 2-5 drawings/photographs, as these marks include a change in form which cannot be shown in a single drawing/photograph.) The time period for submission of files/samples for International Registrations for sound/smell marks designating Korea has been extended from 1 month to 3 months (in consideration of delays attributable to international post). The acceptable methods of indicating a registered trademark have been expanded to include barcodes, QR codes etc. which point to an internet location where the registration number and registration status are presented. Previously acceptable methods were indication of the registration number itself, or provision of a URL where the registration number and registration status are presented.   Author Recent Posts Jonathan MASTERS Latest posts by Jonathan MASTERS (see all) Author Recent Posts Sung-yeon CHO Latest posts by Sung-yeon CHO (see all)

2021-03-08
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Practice Notes

Korea Patent Court takes issue with ex officio examination of trial request validity

Scenario: Party A files a scope confirmation trial, seeking a determination on whether Party B’s working of an invention (hereafter the “invention subject to confirmation”) falls within the scope of Party A’s patent. However, if the invention subject to confirmation is identical to a later-registered patent belonging to Party B (filed and registered later than Party A’s patent), Party A’s trial request is considered improper, as this could effectively result in the validity of Party B’s later-registered patent being denied without it being subject to an invalidity trial. Whether requests for scope confirmation trials are improper in this manner are examined ex officio by the IP Trial & Appeal Board (IPTAB) regardless of the assertions of the involved parties (i.e. Parties A and B in our example). However, a recent Patent Court decision (Case 2019Heo8932 dated September 25, 2020) has stated that if the IPTAB ex officio dismisses a scope confirmation trial after judging it to be improper for the reasons described above but does not give the involved parties an opportunity to submit an opinion, such IPTAB trial decision itself is in violation of procedure. Patent Court Case 2019Heo8932 In this case, the original respondent (hereafter “Party B” as per our general example above) confirmed that the invention subject to confirmation and their later-registered patent were not the same, and so they did not intend to argue that their opponent (“Party A”)’s trial request was improper. In other words, there was no dispute between the parties on the point that Party B’s invention subject to confirmation and later-registered patent were different. Regardless of this agreement, the IPTAB did not allow Parties A and B an opportunity to submit opinions on the identity of Party B’s invention subject to confirmation and later-registered patent. The Patent Court stated that if such an opportunity had been given, Party A could have amended the invention subject to confirmation or argued that Party B’s later-registered patent was different, and the IPTAB’s rendering of an ex officio decision without affording such an opportunity to the involved parties was a procedural violation. Comment Under Korean practice, the party who files a scope confirmation trial is permitted to amend the invention subject to confirmation, but the identity of the invention must be maintained before and after such amendments[1]. Therefore,  even if Party A had been afforded an opportunity to amend the invention subject to confirmation, after amendment it would still have been identical to Party B’s later-registered patent and the IPTAB would have rendered the same decision, meaning that not giving such opportunity does not make the trial decision improper. However, Party A could still have argued the differences between the invention subject to confirmation and Party B’s later-registered patent if they had been able to submit an opinion. Moreover, as neither party contested the point that the inventions were different, if they knew that the IPTAB intended to deny this point, Parties A and B could have negotiated and agreed to a withdrawal of the trial. Therefore, in addition to the Patent Court’s judgement that the IPTAB’s trial decision was a procedural invalidation, I believe it could also be seen as infringing on the disposition rights of the involved parties. Notes: [1]A Patent Act revision dated January 3, 2017 permits amendment of the invention subject to confirmation to conform to the invention that the opposing party actually works when the opposing party argues that the invention subject to confirmation is different from the invention that the opposing party actually works. However, this does apply to the case discussed herein.   Author Recent Posts Young-min KIM Latest posts by Young-min KIM (see all)

2021-01-13
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Practice Notes

KIPO Measures to Prevent Online Counterfeits

Shortcut to… Introduction / Measures / Comment Introduction The Korean Intellectual Property Office (KIPO) recently announced its Measures to Prevent Online Counterfeits. According to a KIPO press release, the number of reports concerning online counterfeits has increased by 204.4% year-on-year (looking at the period of January to August 2019 and 2020) following the increase in online shopping during the COVID-19 pandemic. In response, KIPO has devised the following measures to more effectively combat the rapidly increasing online distribution of counterfeit products while minimizing damage to consumers. Measures Strengthened online crackdowns Offline enforcement personnel are temporarily handling online monitoring. The Special Judicial Police are: directly investigating mass distributors and frequent sellers of counterfeit products; reinforcing investigative manpower; and promoting the advancement of investigation techniques, such as digital forensics. Improved damage relief for consumers In cooperation with trademark holders, the results of a counterfeit product evaluation are shared with consumers to enable unsuspecting purchasers of counterfeit products to receive refunds and request compensation. A damages compensation system has been established, under which online open market platforms compensate for damage resulting from the purchase of counterfeit products first and then claim indemnity from the individual seller. System improvements and increased public-private cooperation It is proposed that trademark law be revised to make sales intermediaries [1]  such as online platforms, responsible for preventing trademark infringement in order to halt the distribution of counterfeit products. Comment Given that the capacity for handling online crackdowns is being strengthened via reinforced manpower at KIPO’s reporting center (composed of members of the Special Judicial Police with expertise in intellectual property) and improved investigation techniques, KIPO will likely respond to online infringement issues promptly. In order to effectively block the online distribution of counterfeit products, rights holders must actively cooperate with the IP office and online platforms. Under the current system, rights holders are responsible for the cost of an appraisal, so it may be burdensome for them to cooperate with all KIPO investigations. However, since it is not easy for KIPO and online platforms to assess counterfeit products and determine whether a product is genuine or counterfeit without the input of the rights holder, such input is necessary for effective investigations. Given current trends, the number of online transactions is expected to continue rising steadily and the number of online rights violations will likely increase alongside this. To protect brand value, IP rights holders should actively utilize the online crackdown systems available via KIPO and actively respond to its requests for an appraisal of suspected infringing products, even if this is burdensome. The proposed trademark law revision includes the introduction of provisions under which the following acts of sales intermediaries would constitute an infringement on the part of the sales intermediary itself (with liability limited when the intermediary fulfills its duty of care): permitting individual sellers to infringe a third party’s trademark rights or exclusive license; or intentionally assisting infringement by individual sellers. If this revision passes into law, online platforms would likely become more active in preventing sellers from infringing trademark rights, as the platforms could be held liable for indirect infringement if they do not fulfill their duty of care. Notes [1] The term “sales intermediary” used throughout this article typically refers to an online platform/open market via which individual sellers can sell goods, similar to platforms popular outside of Korea such as eBay and Amazon Marketplace. There are a number of prominent platforms like this in Korea. Author Recent Posts Jae-sang LIM Latest posts by Jae-sang LIM (see all)

2021-01-08
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Practice Notes

Doctrine of equivalents: recent developments

Shortcut to… Introduction / Supreme Court guidelines / Comment Introduction A patented invention is infringed when another invention (hereinafter the ‘accused invention’) comprises all elements of the patented invention and the relationship between the elements of the accused invention are the same as those in the patented claim (all elements rule). The all elements rule applies not only to literal infringement but also to equivalent infringement. Equivalent infringement is acknowledged when a specific modified element is evaluated as having equivalence to the corresponding element in the patented claim. According to the doctrine of equivalents, even when the accused invention includes a modified element in contrast with the elements in the patented claim, if they are practically equivalent, the accused invention infringes the patented invention. Supreme Court guidelines The Supreme Court has set the following guidelines for applying the doctrine of equivalents (Case 2017HU424, 31 January 2019): the accused invention and the patented invention must adopt the same problem-solving principle; the accused invention must exhibit substantially the same working effects as those of the patented invention (modifiability); a person with ordinary knowledge in the technical field to which the invention pertains (a person skilled in the art) must be able to obviously make such a modification (obvious modifiability); the accused invention should not represent art which was known at the time of filing the application of the claimed invention or art which could easily be conceived by a person skilled in the art from publicly known art (free-to-work technology defence); and the changed element of the accused invention should not represent that which was intentionally omitted from the claims of the claimed invention during the prosecution of the application of the claimed invention (file wrapper estoppel). In order to meet the infringement requirements based on the doctrine of equivalents, all of the above factors must be satisfied. If one of the negative conditions applies – namely, either the fourth or fifth factor, there is no infringement. The Supreme Court has specifically addressed the first factor as follows: When determining whether the accused invention and the patented invention adopt the same problem-solving principle, there should be substantial examination as to what the core of the technical idea forming the basis of the unique problem-solving principle of the patented invention is, in comparison with the prior art, taking into consideration the disclosures in the detailed description of the specification and known technologies at the time of filing of the patented invention. In particular, how broadly or narrowly to interpret the problem-solving principle of the patented invention should be determined according to the extent of the contribution made by the patented invention to the advancement of technology, in consideration of the prior art. According to this ruling, if the core of the technical idea was not already disclosed at the time of filing the patented invention, it must be determined whether the broadly interpreted problem-solving principle is implemented in the accused invention. If so, the first factor will be considered satisfied. Even if there are additional differences in the elements that are not directly related to the problem-solving principle, the first factor will still be considered satisfied. If this factor is satisfied in this way, the second factor will also be considered satisfied as long as the modified element has no significant difference in the working effects compared with those of the patented invention. In contrast, if the core of the technical idea was already disclosed at the time of filing the patented invention, since the problem-solving principle cannot be said to be unique to the patented invention, it must be determined whether the modified element has the same working effects in terms of individual functions or roles (Case 2018DA267252, 31 January 2019). Thus, in most cases, the second factor would be considered unsatisfied. Comment In accordance with these court rulings it is now possible for patents to be protected according to the real value of the invention, which is appraised in consideration of prior art. The problem is that judgments may vary with respect to what constitutes the core of the technical idea forming the basis of the unique problem-solving principle of the patented invention. As such, there is arguably increased uncertainty about the possibility for equivalent infringement.   Author Recent Posts Young-min KIM Latest posts by Young-min KIM (see all)

2020-12-15
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Practice Notes

Treble Damages Now Available for Trademark and Design Infringement

Amendments to the Trademark Act and Design Protection Act effective from October 20, 2020 have added support for treble damages in certain infringement scenarios. The amendments are effective immediately and apply to acts of infringement conducted after October 20, 2020. Prior to the new amendment, damage compensation available to rights holders has generally been calculated based on (i) profits lost by the right holder due to the infringement, (ii) profits obtained by the infringer based on the infringement, or (iii) “ordinarily expected” royalties. This system, however, has flaws; namely, in the case of (i), damages are limited to the sales capacity of the rights holder (i.e. the damages cannot exceed that which the rights holder could have sold, even if the infringer committed significantly more infringement) — this is problematic especially where the infringer is a larger-scale entity than the rights holder, and in the case of (ii), damage calculation can be impacted by a non-cooperative infringer providing insufficient financial data. These amendments follow similar changes to the Patent Act and Unfair Competition Prevention and Trade Secret Protection Act relating to willful patent infringement and trade secret misappropriation which came into effect in July 2019. (See here for more details.) There are also changes to the way royalties are determined in damage calculation and the statutory damages available in trademark infringement cases. We will look at the amendments in more detail below. 1) Enhanced Damages (Trademark | Design) The new provision allows the court to multiply the damages calculated by one of the existing methods up to threefold in cases of intentional (willful) infringement, going some way to alleviate the inherent shortcomings described above. In determining the multiplier, the following factors are to be considered: Trademark Design The degree to which the distinctiveness or reputation of the infringed trademark has been tarnished The degree of intent or the extent to which the infringer was aware of the potential damage The amount of damage suffered by the trademark holder / exclusive licensee due to the infringement The economic benefits gained by the infringer The period and frequency of the infringement The fine for infringement The economic status of the infringer The degree of effort made by the infringer to alleviate damage Whether the infringer is in a position of superiority The degree of intent or the extent to which the infringer was aware of the potential damage The amount of damage suffered by the design right holder / exclusive licensee due to the infringement The economic benefits gained by the infringer The period and frequency of the infringement The fine for infringement The economic status of the infringer The degree of effort made by the infringer to alleviate damage It should be noted that in trademark infringement cases, willfulness is presumed when the fact of trademark registration is displayed. Specifically, any person who has infringed trademark rights or an exclusive license of another person who indicates that the trademark in question is registered shall be presumed to have been aware that the trademark was already registered, in relation to his/her infringement. (See here for more details about IP marking.) 2) Royalty Rate Used in Damage Calculation (Trademark | Design) There has also been criticism aimed at damage calculation method (iii) above in that it is not always possible or appropriate to determine an “ordinarily expected” royalty, for example in cases where there is not a standard royalty rate, or where an average rate may not be applicable to the case in question. The amendment changes this wording from “ordinarily expected” to “reasonably expected”, allowing for a calculation based on factors relevant to the specific case, rather than being based on existing precedent. 3) Statutory Damages (Trademark) Instead of calculated damages, trademark rights owners have been able to claim statutory legal damages since 2011, up to a capped limit of ₩50 million KRW (approx. $42,500 USD). This offers a way to claim damages from an infringer with a reduced burden to prove actual monetary damages incurred, instead allowing the court to determine the appropriate compensation based on the facts of the case. In consideration of changing market conditions and inflation, this cap has now been raised to ₩100 million KRW (approx. $85,000 USD) in cases of negligent infringement, and up to ₩300 million KRW (approx. $255,000 USD) in cases of intentional infringement. Author Recent Posts Ben YUU Latest posts by Ben YUU (see all) Author Recent Posts Jonathan MASTERS Latest posts by Jonathan MASTERS (see all)

2020-10-28
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Practice Notes

Considerations when establishing South Korean patent portfolios

Shortcut to… Technology Fields / Systems   In this article, we will compare the patent registration rates by technology field in Korea and the other IP5 jurisdictions, and also look at the systems which may be used in establishing a patent portfolio, comparing in particular with the US. Technology Fields According to the Korean Intellectual Property Office (KIPO), when comparing deviations in patent registration rates in IP5 jurisdictions by technology field (based on the 2010 to 2018 averages), compared with other fields of technology, it is apparent that: the United States ranks highly in the fields of communication, audio and video and computing; Europe ranks highly in the fields of machinery and automotives; China ranks highly in the fields of semiconductors and communications; and Japan ranks highly in the fields of chemistry and the materials and components industry. Both Europe and China rank poorly in the e-commerce field. From this, it can be said that the patent registration rate is high for particular fields in jurisdictions where there is strong competition in that sector. By contrast, South Korea does not display such distinct characteristics as the other IP5 members. Turning to the field of fourth industrial revolution technology, AI, autonomous vehicles, intelligent robots and digital healthcare have become hot topics in recent years. In the fields of AI, autonomous vehicles and intelligent robots, the registration rate in South Korea is average compared with that of the United States, Europe and Japan. In the digital healthcare field, the registration rate is higher in South Korea than in the United States and Europe and similar to that of Japan. However, unlike Japan, where the registration rate of domestic applicants is higher than that of foreign applicants, the registration rate of foreign applicants is higher in South Korea. Artificial Intelligence  Autonomous Vehicles  Digital Healthcare Intelligent Robots [Comparison of domestic vs. foreign applicant registration rates for 4th industrial revolution technology (2010-2017 average) | Source: KIPO] Systems In the United States (particularly after a notice of allowance has been issued), continuation applications may be used to obtain related patents and broaden the scope of rights protection. However, in South Korea only divisional applications are supported and there is no continuation filing system such as continuation or continuation-in-part applications. Further, in South Korea, it is impossible to file a divisional application after a final rejection has been appealed. Specifically, if an applicant files an appeal which ultimately ends up being rejected, there is no opportunity to file a divisional application thereafter. One particular point of caution is that even if only one rejection reason remains unresolved during the appeal (in other words, not all rejection reasons are resolved), the application is rejected in its entirety. This also applies even if the application contains an allowable invention. Therefore, when an appeal is to be filed against a final rejection, applicants should also consider filing a divisional application in order to secure the opportunity to further prosecute the patent application in case the appeal fails. In the United States, re-issued patents are actively used in particular by non-practicing entities. With re-registration, it is possible to expand the scope of rights under certain conditions; however, like other IP5 members, South Korea does not allow for change or expansion of the scope of rights after a patent right has been granted.   Author Recent Posts Young-min KIM Latest posts by Young-min KIM (see all)

2020-10-28
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Practice Notes

Relying on the IP Office to Combat Infringement

Shortcut to… Introduction / KIPO SJP: statistics / Where to file criminal complaints?   Introduction The Korean Intellectual Property Office (KIPO) operates a special judicial police (SJP) unit, under which officials belonging to the KIPO can take charge of criminal cases relating to the infringement of IP rights (eg, trademarks (counterfeit products), patents, trade secrets and designs). In South Korea, there are SJP units for a number of fields in which specialist expertise is required to conduct an investigation (eg, Customs, railways and agriculture). On receiving a report concerning a potential IP infringement, the KIPO SJP: specify the infringement based on the reporter’s statement and submitted data; collect and review evidence; and determine as to whether there has been an infringement based on the full investigation data. A report is prepared and delivered to the Prosecution Service. KIPO SJP: statistics The KIPO has recently released statistics about the SJP’s achievements which show that over the past 10 years: it has handled approximately 45,000 cases; close to 3,500 criminal charges have been made; and approximately 12 million counterfeit products have been confiscated (with the corresponding value of genuine goods being over W500 billion or $425 million).   [KIPO Special Judicial Police Achievements (Jan 2011 – Aug 2020) | Source: KIPO] The KIPO SJP has actively investigated the large-scale distribution of counterfeit products, with cases including: a counterfeit health food distributor (May 2015: the corresponding value of the genuine goods was approximately W65.2 billion or $55 million); and counterfeit mask pack manufacturers and distributors (July 2019: the corresponding value of the genuine goods was approximately W20 billion or $17 million). Aside from such examples relating to public health and safety, the scope of the SJP’s activities has even extended to K-pop, with a crackdown in 2019 focusing on BTS-related counterfeit products (BTS being a Korean boy band that has achieved global fame in recent years). Until March 2019, the scope of the SJP’s duties was limited to trademark cases, but has since expanded to include patents, trade secrets and design infringement cases. By utilising investigators with relevant technical experience, more rapid and reliable determinations on infringement have become possible and in the past 18 months alone (from March 2019 to August 2020), 276 technical cases have been handled and 438 infringers have been criminally charged. Where to file criminal complaints? Any party whose IP rights have been infringed may file a complaint with the prosecution or police, or alternatively file a report with the KIPO directly. The prosecution has a dedicated prosecutor for IP-related cases at each local and branch office across the country, although they also handle general criminal cases at the same time, and most police stations have no dedicated department for IP rights. Further, due to the rotation of specialist staff, the prosecution and police may have fewer opportunities to accumulate expertise. For these reasons, criminal complaints relating to IP infringement may not be given such full and prompt investigation if filed with the prosecution or police. On the other hand, reports filed with the KIPO can be investigated by SJP officers with IP expertise who may rely on compulsory investigation rights such as arrest to efficiently handle cases. The SJP also has a target of dealing with cases within three months, meaning that the turnaround time is also comparatively fast. In short, given the KIPO’s active response to IP infringement cases, the SJP is now a good alternative to the traditional avenues of police or prosecution for IP right holders filing criminal complaints.   Author Recent Posts Jae-sang LIM Latest posts by Jae-sang LIM (see all)

2020-10-27
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Practice Notes

The influence of functional parts when determining design similarity

When determining the similarity of designs, how is the court’s judgement affected when a design element has commonality with a functional element? A recent Supreme Court decision allows some insight into this question. Existing Precedent The determination of whether designs are similar should be judged not by separating and contrasting the individual elements, but instead in accordance with the aesthetic sensibilities of a viewer observing and contrasting the designs as a whole. However, in the case that the common parts of both designs are an intrinsic part of the product, or a basic/functional form of the design, such parts should be given low importance and the compared designs cannot immediately be deemed identical or similar based only on the identity/similarity of such parts. (Supreme Court Decision 2003Hu1666; October 14, 2005.) Decision 2016Hu1710 Per existing precedent, in Decision 2016Hu1710 (September 3, 2020), a case relating to cargo vehicle toolbox designs, the Supreme Court ruled that in the case that the common parts of both designs are an intrinsic part of the product, or a basic/functional form of the design, such parts should be given low importance. However, the court additionally ruled that if it is possible to select an alternative form which can secure the function of the product (see Fig. 3 below), such form is not essential in securing the function of the product and is instead simply related to the function, and so such part should not be given low importance when determining the similarity of designs just because it is related to the function. Fig. 1: Registered design Fig. 2: Preceding design In this case specifically, the court stated that the registered design in question and the preceding design have the following in common: The rectangular incision groove formed in the upper left corner of the body (Fig. 1 [1]; Fig. 2 [a]). The upper left part of the hinged door formed in the front of the body is cut at a 45º angle (Fig. 1 [2]; Fig. 2 [b]). A long inclined surface about the width of the hinged door is formed on the upper part of the body located at the top of the hinged door (Fig. 1 [3]; Fig. 2 [c]). A hemispherical concave groove is formed obliquely at the rear center of the right side of the body (Fig. 1 [4]; Fig. 2 [d]). The court stated that the parts in common were not seen as being essential in securing the function of the cargo vehicle toolbox, and in commerce, it is expected that consumers would consider the aesthetics of the designs as a whole, including the features of the above parts in common. Accordingly, such parts should not be given low importance when determining the similarity of the designs just because they are related to the function, or are not visible after installation, and the similarity of the designs should be judged in accordance with the aesthetic sensibility felt when observing the designs as a whole, including such common parts. The court went on to rule that while the registered design in question and the preceding design differ in respect of the following, when observed as a whole, the designs are aesthetically similar and thus are regarded as being similar designs: The narrow band protruding at the lower part of the concave elevation (Fig. 1 [5]) vs. no such protruding band (Fig. 2 [e]). The rectangular concave surface formed in a horizontally long rectangle on the front of the hinged door (Fig. 1 [6]) vs. the concave elevation being pentagonal, with triangular shapes protruding symmetrically on both sides of the concave elevation (Fig. 2 [f]). The palm-of-the-hand-shaped figure and ‘5000’ text expressed on the left side of the body and the lower right side of the hinged door (Fig. 1 [7]) vs. no such parts (Fig. 2 [g]). Take-aways  Looking at this precedent, we may understand that the registered design in question is not strictly necessary to secure the function, and rather, as there exists a selectable alternative form (e.g. the known design shown in Fig. 3), the registered design in question is not seen as being essential in securing the function of the cargo vehicle toolbox, and so should not be given low importance when determining the similarity between designs. Fig. 3: Known design example In principle, if the common part of designs being compared is a basic or functional form of the product that has been widely used before the filing date of either design in the field to which the designs belong, the court should give low importance to such part when determining similarity. However, if the common part is not essential in securing the function of the product, when determining similarity between designs, the designs should be considered as a whole, including such part. Therefore, if there is commonality between a to-be-applied-for design and an existing design, where such common part is a basic or functional form of the product that has been widely used in the field to which the designs belong, it is necessary to consider (i) whether the designs differ except for such part, and (ii) if the common part is not essential, whether the to-be-applied-for design as a whole, including such part, offers a different aesthetic sensibility to the existing design. Author Recent Posts Jae-sang LIM Latest posts by Jae-sang LIM (see all)

2020-10-15
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Practice Notes

IP Marking in Korea: Risks and Benefits

There is no obligation to mark your IP rights on products in South Korea. Whether to do so is at the discretion of the IP owner, and there are no direct negative legal consequences arising from failure to indicate IP rights. Patentees, for example, can seek damages from the patent grant date regardless of whether their patent is indicated, and any person who infringes a patent shall be presumed negligent regarding such infringement no matter whether the patent is marked on the product or not. Nevertheless, indicating IP rights does grant some legal benefits, which will be discussed below. Also, from a practical sense, it may be a useful advertisement or marketing tool, e.g., to show the public that the company is innovative, deter competitors from copying, persuade the public that the article has government approval, or even lead the public into thinking the article is better than others. 1. What are the legal benefits of IP marking? The most obvious benefit of indicating IP rights has to do with proving willfulness or allowing for a presumption of willfulness in infringement cases. In trademark infringement cases, willfulness is presumed. Specifically, any person who has infringed trademark rights or an exclusive license of another person who indicates that the trademark is registered shall be presumed to have been aware that the trademark was already registered, in relation to their infringement. In patent infringement cases, willful infringement is found when the conduct is deliberate and intentional, and with knowledge of the patent. If so, the court may increase the damages by up to three times the amount calculated or assessed (see here for a discussion of the treble damage system). In terms of punishment, any person who willfully infringes a patent shall be punished by imprisonment with labor for not more than 7 years or by a fine not exceeding 100 million Korean won (approx. $85,000 USD at current exchange rates). To prove the willfulness of patent infringement, the first requisite is that the infringer acknowledges the existence of IP rights. IP markings could come into play in this situation, and under certain fact-specific scenarios, the indication of patent rights may be useful to prove the knowledge or intention of the alleged infringer. 2. How should IP rights be marked on products? A patentee/licensee may indicate that their products are patented by using the wording “Patented” together with the patent number. For pending applications, an applicant may use the wording “Patent Pending (Under Examination)” with the application number. For inventions relating to a process for manufacturing a product, “Process Patented” or “Patent Pending for Process (Under Examination)” shall be marked on the product. Such wordings may also be used on the container or package of the product. A design right-holder may also place wording indicating their design registration on products covered by the registered design or containers or packaging materials of such products. Acceptable wordings are “Design Application” or “Design Under Examination” for pending applications, and “Registered Design”, “Design”, “Design Registration” or “Design Right” for registered designs. Likewise, where a trademark right holder or licensee uses a registered trademark, they may indicate that the trademark is registered. Examples of acceptable wordings are “Trademark Application” or “Trademark Under Examination” for pending applications, and “Registered Trademark”, “Trademark”, “Trademark Registration”, “Trademark Right” or the “®” symbol for registered trademarks. The indications of patent, design, or trademark rights may be expressed in English (including English abbreviation) or Chinese as well as Korean. Indication via internet links is also allowable. As an example, IP holders may mark a product with a link to a website showing a list of applicable patents, designs or trademarks. This also includes bar codes, QR codes, or other forms of electronic display means. 3. Should patent-marked products be identical to the claimed elements of the patent? The technical composition of a product marked as being patented must be the same as that of the patented invention. However, it may not always be deemed false marking even if the composition of the product only partially corresponds to the patented invention. Specifically, if the difference between the product and patented invention is merely an addition/deletion/modification of the technical composition that would be commonly carried out by those in the relevant technical field with ordinary knowledge, there is no practical difference in the effect of the invention, and the difference is not of an extent that would mislead the public, the conduct would not be considered false marking (Korean Supreme Court: Decision 2013Do10265). In addition, if the manufacturing of the patentee’s product embodies the core technical idea of the patent, so long as the difference between the product and patented invention is not of an extent that would mislead the public by exploiting either the commercial advantages afforded by the patent or the public’s trust in patents, it would not likely be deemed ‘false or exaggerated labeling or advertising’ prohibited under the Act On Fair Labeling And Advertising (Seoul High Court: Decision 2013Nu9931) 4. What are the consequences of false marking? False marking is a criminal offense. No person shall indicate “Patented”, “Patent Pending” or any similar misleading wording on any unpatented thing, anything for which no patent application has been filed, anything manufactured by any unpatented process or by any process for which no patent application has been filed, or any container or packaging of such thing. Any person who violates this rule shall be punished by imprisonment for not more than three years, or by a fine not exceeding 30 million Korean won (approx. $25,000 USD at current exchange rates). The same applies identically to false marking of design and trademark rights, with the same punishments. If IP rights are extinguished while products still remain in the market, this fact should be indicated accordingly unless there is already a clear indication of the IP term of protection. 5. What can be done if it is found that somebody else is falsely marking? If any IP markings considered to be false or improper are located, this fact can be notified to the Center for Prevention of False IP Marking (www.ip-navi.or.kr) which is operated in conjunction with the Korea IP Protection Agency (“KOIPA”) and the Korean IP Office (“KIPO”). If it is found that the markings are indeed false or improper, KOIPA or KIPO may recommend appropriate corrective measures such as deletion and modification of the markings.  Should the offender not comply with the corrective measures, KOIPA or KIPO may then file a criminal complaint in accordance with the Criminal Procedure Act. Author Recent Posts Ben YUU Latest posts by Ben YUU (see all)

2020-09-18
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Practice Notes

Patentee protection strengthened in series of revisions to Korean patent law

In Korea, the low amount of damages awarded by courts in patent infringement cases has long been criticized. To address this, a treble damages system (implemented in July 2019) and an improved method for calculating the amount of damages (to be implemented on December 10, 2020) have been introduced. We will look at these in a little more detail, as well as a proposed law revision to improve evidence collection. Treble Damages The treble damages system allows the courts to multiply the proven amount of damages up to threefold in cases of ‘intentional’ infringement. Historically, under-compensation was common in patent infringement cases where the true amount of damage incurred was difficult to prove. The courts’ ability to now multiply the amount of proven damages alleviates this problem and allows for more effective compensation. The criterion by which infringement is deemed to be ‘intentional’ or not will become more apparent as relevant case law emerges, though the multiplier is determined based on a number of factors specified in law: Whether the infringer is in a position of superiority The degree of intent or the extent to which the infringer was aware of the potential damage The amount of damage suffered by the patent holder / exclusive licensee due to the infringement The economic benefits gained by the infringer The period and frequency of the infringement The fine for infringement The economic status of the infringer The degree of effort made by the infringer to alleviate damage While the intention of the Administration appears to be punitive compensation, from the perspective that the Korean civil law compensation system is based on compensatory damages, rather than being punitive, in my opinion, it is likely that the new system instead simply makes it more likely that patent owners are able to effectively obtain compensation sufficient to make up for the damage they have suffered. Damage Calculation The improved method for calculating damages will allow for a reasonable license fee for infringement in excess of the patentee’s own production capacity. Under the current law, damages are calculated up to the limit of the patentee’s own production capacity, even if the infringer exceeds this limit. (By way of a simple example, if an infringer sold 200 items while it is regarded that the patentee could only have produced 100 items in the same timeframe due to production constraints etc., the ‘excess’ 100 items are not included in the calculation of damages.) However, the revised law will allow for a reasonable licensee fee to be awarded in such cases, based on the following formula. Damages = [Patentee’s production capacity x Per-item profit] + [Excess x Reasonable license fee] Improved Evidence Collection To better protect patentees, further to the amendments already discussed above, the evidence collection system itself must be revised to better facilitate the securing of evidence relating to infringement and damages. A revision to the Patent Act relating to the so-called ‘K-Discovery’ system is currently under review. This is closely linked to the collection of evidence to prove infringement is ‘intentional’, a requirement of the treble damages system. The revision would allow courts in patent infringement litigation to nominate an expert who, either at the court’s ex officio direction or at the request of a party, would have authority to conduct an investigation at the site where infringement takes place (e.g. production facility) to obtain relevant evidence and submit the findings to the court. This may be considered similar to the inspection system available in Germany. While limited in scope when compared to the discovery system of evidence collection in the United States, these proposed changes to allow evidence to be collected at the court’s discretion should enable faster resolution of disputes while still keeping litigation costs relatively low. If the K-Discovery system becomes law, the protection available to patent holders could be strengthened to a much greater degree. Author Recent Posts Young-min KIM Latest posts by Young-min KIM (see all)

2020-09-17
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Practice Notes

Relaxing of Design Protection Act Enforcement Rules (from September 2020)

Continuing the trend for relaxed requirements for design applications (see our earlier updates here and here), the Enforcement Rules of the Design Protection Act have been further eased in several aspects, as explained in more detail below. 1. Mixed drawing formats (from September 1, 2020) While both 2D line drawings and 3D-rendered drawings are acceptable formats for drawings in a design application, it has always been the case that the same drawing format must be used in the original application and any subsequent amendments. In other words, if the application was filed with 2D line drawings, any later amendments also had to be 2D line drawings. This requirement has now been removed, and applicants are free to file amendments in either format, regardless of the format of the original drawings. 2. Font designs in TTF format (from September 1, 2020) While font files are commonly created and distributed using the True Type Font (TTF) format, in order to file for font design protection it was previously necessary to prepare separate drawings in a standard drawing format (e.g. TIFF or JPEG). However, design applications for fonts can now be based on TTF font files. 3. Further categories of design eligible for partial examination (from December 1, 2020) Designs sensitive to trends or which have a short life-cycle are subject to “partial” examination, which comprises a check of application formalities, industrial applicability and limited novelty requirements (cannot be a “widely known” design), but does not include substantive examination of novelty, creativity, etc. This enables rights owners to get their designs registered more quickly (see here for more information on examination timeframes). Partial examination was previously only applicable for designs in Locarno classes 02, 05, and 19, but this has now been expanded to include Locarno classes 01, 03, 09 and 11, with the full updated list shown below (class descriptions taken from the WIPO Locarno Classification tool). Class 01: Foodstuffs Class 02: Articles of clothing and haberdashery Class 03: Travel goods, cases, parasols and personal belongings, not elsewhere specified Class 05: Textile piece goods, artificial and natural sheet material Class 09: Packages and containers for the transport or handling of goods Class 11: Articles of adornment Class 19: Stationery and office equipment, artists’ and teaching materials Designs in all other Locarno classes will remain subject to full, substantive examination. Author Recent Posts Sung-yeon CHO Latest posts by Sung-yeon CHO (see all) Author Recent Posts Jonathan MASTERS Latest posts by Jonathan MASTERS (see all)

2020-09-09
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