This case introduces a novel litigation strategy for assessing patent infringement related to the use of large industrial equipment, particularly in situations where obtaining physical evidence is challenging. It also highlights the commitment of Chinese courts to address evidentiary difficulties faced by rights holders.

The plaintiff, Siemens AG, has developed an innovative technology called “neutral point drift,” which is incorporated into its inverter products and has been patented in numerous countries, including the patent at issue in this case. This technology is designed for multi-phase power supplies that connect several power units in series on each branch. In the event of a failure in a power unit on a specific branch, the “neutral point drift” technology enables the remaining operational power units to fully utilize their output capacity, thereby optimizing the line-to-line voltage output of the power supply.

The defendant, Suzhou Inovance Technology Co., Ltd., founded in 2008, is recognized as one of the prominent inverter manufacturers in China. In late 2017, the plaintiff became aware that Inovance was advertising its allegedly infringing high-voltage inverter products on its official website and in product manuals. The company claimed that these products utilized “neutral point drift” technology, which it referred to as “asymmetric bypass technology,” highlighting the technical benefits associated with it. Notably, the schematic used to illustrate the “asymmetric bypass technology” was identical to Figure 5a in the relevant patent. Consequently, the plaintiff suspected that the “asymmetric bypass technology” employed in the accused products likely fell within the patent’s scope. Following unsuccessful negotiations, the plaintiff initiated legal proceedings by filing a lawsuit with the Suzhou Intermediate People’s Court in March 2019, which is referred to as “this case.”

The high-voltage inverters at the center of this case are standard industrial products, typically utilized in advanced applications across sectors such as steel, electricity, coal, and chemicals. These inverters are quite costly, with prices ranging from several hundred thousand to over a million RMB, and they have specific sales targets. As a result, they are not as widely available in the market as low-voltage inverters, which poses a significant challenge for the plaintiff in acquiring the allegedly infringing products to present physical evidence in court. Consequently, the plaintiff has relied on written evidence sourced from public materials, including product manuals for the accused inverters and articles published by the defendant on their website and in various journals. By leveraging the defendant’s own descriptions of the products, the plaintiff seeks to establish a strong likelihood that the accused items fall within the scope of the patent in question. Thus, the question of whether infringement can be determined based solely on written evidence has emerged as a key point of debate in this case.

The defendant contended that the articles and product manuals provided by the plaintiff were simply promotional materials and did not accurately represent the technical solutions utilized by the allegedly infringing products. As a result, they argued that these materials should not be used as a basis for assessing infringement.

However, the Suzhou Intermediate People’s Court (“Suzhou Court”) ruled that current legislation does not require the physical presence of the accused infringing product to establish infringement. Even without physical verification, evidence that objectively and accurately reflects the methods employed by the accused products can be considered for determining infringement. Furthermore, the descriptions of the accused products and their technical solutions found on the defendant’s website and in public media are presumed to accurately represent the relevant technical solutions. Suzhou Court then compared the accused products with the claims made by the plaintiff, particularly noting that the defendant had used a diagram identical to that in Figure 5a of the patent in question when outlining the technical solution of the accused products. Ultimately, Suzhou Court concluded that the accused products fell within the protective scope of the patent and fully supported the plaintiff’s request for damages. Inovance was dissatisfied with Suzhou Court’s ruling and subsequently appealed to the Supreme People’s Court, which later issued a second-instance judgment rejecting the appeal and affirming the original decision.

In typical civil cases involving patent infringement, the plaintiff, as the rights holder, must present the actual product in question to the court. This allows them to demonstrate and establish that the technical solution utilized by the allegedly infringing product includes all the technical features outlined in the claims made. In Chinese judicial practice, the most common method for obtaining the physical object of an allegedly infringing product and presenting it as evidence in court is through a notarized purchase. When acquiring the physical object proves challenging, there are alternative methods available to gather evidence related to it. One option is to take notarized photographs and videos of the accused infringing product, which can then be used for technical comparison. Another approach is for the plaintiff, who knows the precise location of the infringing product, to request the court to conduct an on-site inspection or preserve evidence of the product. Additionally, some rights holders may seek to gather evidence of infringement through patent administrative enforcement procedures.

In this context, the Supreme People’s Court has clarified that physical evidence is not a strict requirement in patent infringement cases. While examining the physical object of the allegedly infringing product or equipment is one effective method for determining the technical solution and conducting an infringement analysis, it is not the sole approach. Even without physical verification, existing evidence that objectively and accurately reflects the technical solution implemented by the accused product can be utilized to assess potential infringement. In the absence of contradictory evidence, written materials such as product manuals and information published on the accused infringer’s official website can be relied upon for infringement comparison.

This case presents a novel evidentiary strategy for patent holders, especially those holding patents for large industrial equipment. In situations where obtaining physical evidence of the allegedly infringing product proves challenging, patent holders are encouraged to gather extensive written documentation to illustrate the technical solutions utilized by the accused product, thereby establishing a strong likelihood of infringement. With this evidence in hand, they can petition the court to shift the burden of proof, which may result in a presumption that is unfavorable to the accused infringer. On the other hand, defendants should consider adopting a more proactive evidentiary approach when the plaintiff’s evidence indicates a substantial likelihood of infringement. Rather than clinging to the outdated belief that the burden of proof rests solely with the plaintiff, defendants should tailor their strategy to the specifics of the case.