China's Supreme People's Court has decided in favor of AMSC on the jurisdiction of two software copyright infringement cases. The Supreme Court has dismissed jurisdiction opposition raised by the defendant and ruled that the cases be heard by competent courts.

Background

In September 2011, American Superconducter’s China subsidiary (hereinafter “AMSC”) filed a civil action with Beijing No. 1 Intermediate People's Court for unauthorized copying and use of AMSC's software by Sinovel Wind Group Co., Ltd. (“Sinovel”). In November 2011, Sinovel filed a motion to remove this case from the Beijing No. 1 Intermediate People's Court and transfer the matter to the Beijing Arbitration Commission. The court denied Sinovel's motion. Sinovel appealed with Beijing High People's Court but was not supported by the Beijing High Court. Sinovel then filed an appeal with China's Supreme People's Court. The Supreme People's Court held two hearings before founding that Sinovel’s appeal lacked factual and legal basis and ruled recently to uphold the Beijing High Court decision.

In September 2011, AMSC also filed a copyright case against Sinovel and Guotong Electric with Hainan No. 1 Intermediate People's Court. In this case, Sinovel filed a jurisdiction opposition motion on the ground that AMSC and Sinovel had agreed to submit their contractual disputes to arbitration. The Hainan Court granted Sinovel’s motion and dismissed AMSC's case against both Sinovel and Guotong. AMSC appealed the dismissal to Hainan High People's Court, which upheld the decision of Hainan No. 1 Intermediate People's Court. AMSC then filed an appeal of that decision with China's Supreme People's Court. The Supreme People's Court held two hearings and has recently found that the first and second instance courts applied the wrong law and therefore ruled that the previous two rulings made by Hainan courts be overturned and the case be heard by Hainan No.1 Intermediate People’s court.

The series intellectual property actions brought by AMSC against Sinovel have attracted attention in and outside China due to the claim of about RMB 3 billion damages and the fact that the parties are well-known companies in the industry.