In patent infringement civil lawsuits, the accused party not only can claim invalidity of the patent with the civil court, but also can initiate a cancellation action to the Taiwan Intellectual Property Office (TIPO) for the invalidation of the patent right; such a two-track mechanism may lead to a difference of opinion between the civil court and the TIPO.

If a civil court rules in its final judgment that the patent asserted is valid and grants the request of the patentee, but the TIPO subsequently revokes the patent, can the accused party initiate a retrial on the grounds that the patent was revoked, in accordance with Item 11, Paragraph 1, Article 496 of the Taiwan Code of Civil Procedure, which provides that cases may be reheard if the "referenced administrative decision, based on which the civil judgment was entered, was changed"?  For this issue, the Supreme Court and the Intellectual Property Court held contradictory views in a case, as described below.

In Judgment 2013-Min-Zhuan-Shang-Zai-4, issued on September 5, 2014, the Intellectual Property Court denied the right of the accused party to file a retrial on the grounds that the patent at issue was revoked.  The reason is: Article 16 of the Intellectual Property Case Adjudication Act has already bestowed on the civil court the authority to adjudicate the validity of a patent; therefore, the civil court's determination on the patent validity was made after evidence investigation and fact-finding procedures conducted by itself, not relying upon the TIPO's decision of granting the patent at issue.

However, this judgment made by the Intellectual Property Court was reversed by the Supreme Court's Civil Judgment 2015-Tai-Shang-Zi, issued on March 12, 2015. The Supreme Court ruled that a patent right is gained through an effective administrative decision granting of a patent by the TIPO. Based on such administrative decision, the patentee is able to initiate patent litigation when his patent right is infringed upon by others.  That the accused party should be held liable under the original binding judgment was also due to the fact that the party infringed the patent at issue. Therefore, the administrative decision granting the patent did form the basis of the judgment. In addition, according to Articles 82 and 120 of the Patent Act, where an invention patent is revoked finally and bindingly, the effect of the patent right shall be deemed not to have existed from the beginning, so it should be considered that the administrative decision (i.e., grant of patent) that formed the basis of the judgment has been changed. Thus, if an accused party files a retrial based on the foresaid grounds, such grounds are in line with the requirement provided in the Code of Civil Procedure.  The Supreme Court also pointed out that the original judgment in this case was disputable since the original court did not actually determine the patent validity because the accused party delayed to present the patent invalidity arguments and the original court thus dismissed such arguments.

Given the above, an accused party who receives an unfavorable binding judgment may file a retrial against the judgement if the patent at issue is revoked through the cancellation action.  In addition, in the above-mentioned case, the Intellectual Property Court declined to investigate the defendant's patent invalidity arguments because such arguments had not advanced until appeal, but this handling was criticized by the Supreme Court, holding that "the original court did not actually determine the patent validity," and hence the accused party's filing for retrial was approved. Thus, whether the Intellectual Property Court will always examine the delayed patent invalidity arguments submitted only in appeal, and avoid using the provision regarding "Preclusion Effect of Late Submission" under the Code of Civil Procedure, is also worthy of observation.