Patent enforcement proceedings

Lawsuits and courts

What legal or administrative proceedings are available for enforcing patent rights against an infringer? Are there specialised courts in which a patent infringement lawsuit can or must be brought?

A patent infringement lawsuit for damages or an injunction may be filed in one of the following six specialised district courts according to jurisdiction: Seoul Central District Court, Daejeon District Court, Daegu District Court, Busan District Court, Gwangju District Court and Suwon District Court. Notwithstanding the foregoing, regardless of jurisdiction, the plaintiff may elect to have the case heard at the Seoul Central District Court.

However, a preliminary attachment or a preliminary injunction must be requested to one of the 58 district courts and their branches across the nation that has personal jurisdiction over the defendant.

When potentially infringing goods are being imported into Korea, a patentee may alternatively, or in addition, request that the Korea Trade Commission (KTC) institute an investigation of the potential infringement. The KTC proceedings differ from district court proceedings primarily as to the remedies that are available in the event that infringement is proven. A prevailing patentee in a court proceeding may be entitled to both monetary damages and an injunction against future infringement, whereas in a KTC proceeding the primary remedy is an order excluding future importation of the infringing goods into Korea and monetary damages are not available.

As a third option, a declaratory judgment of infringement is available at the Intellectual Property Trial and Appeal Board (IPTAB). The IPTAB is an independent administrative agency under the umbrella of the Korean Intellectual Property Office (KIPO). A declaratory judgment suit may be initiated with or without a co-pending infringement action before a district court for damages or injunction.

The Patent Court has been established since 1998 and hears all appeals from the IPTAB decisions, including the declaratory judgment of infringement, patent invalidity and the patent examiner’s final decision to reject patent applications. In addition, the Patent Court has jurisdiction over appeals of judgments in patent infringement lawsuits. However, appeals of preliminary attachment or preliminary injunction judgments are heard by appellate divisions at the district court if the preliminary attachment or preliminary injunction request was dismissed or the High Court in one of the six large cities within which the district court resides if the preliminary attachment or preliminary injunction request was granted.

Since patent infringement is also a criminal offence, criminal as well as civil proceedings are available, though criminal offences are prosecuted by the Public Prosecutors Office and are not common. In this chapter, our discussions are limited to civil actions.

Trial format and timing

What is the format of a patent infringement trial?

No jury trial is available in Korea for civil cases. Civil patent infringement cases are tried before a panel of three judges. The most senior judge of the panel presides at the trial and has the most influence on the outcome of the trial.

The primary vehicle for introducing evidence in an infringement trial is a motion for introducing evidence. Though documentary evidence is important and believed to be reliable, live testimony of witnesses is not unusual. The presiding judge usually leads the examining of the witness. Counsel for the party offering the witness is routinely allowed to question the witness to elicit direct testimony, after which counsel for the opposing party has the opportunity to cross-examine the witness on matters within the scope of the direct testimony. Typically, the offering party is thereafter permitted to re-conduct direct examination. The judge may additionally ask questions to clarify particular points of interest. Documents and other physical items, such as a sample of an allegedly infringing device, may also be received into evidence by a motion of a counsel.

Each party in a patent infringement case will usually present expert witnesses on technical matters. Experts are permitted to testify as to their opinions on matters within their recognised area of expertise.

A significant element in Korean patent trial practice is a declaratory judgment of patent infringement (or non-infringement) litigated before the IPTAB. Though the jurisdiction of the IPTAB on declaring patent infringement is not an exclusive one, IPTAB proceedings are frequently invoked especially when an action in a district court is not yet initiated.

Trials in Korea are typically held with three- or four-week intervals if not decided after a one-day trial. The number of patent infringement trials varies, depending on the nature of the issues to be decided, from one trial to several trials. Since discovery process is not available under the Korean legal process for getting evidence, motion practice is widely used to get evidence that is not under the control of the plaintiff. Thus, the first or the second hearing date is used for raising motions to get evidence, as well as fixing the issues to be decided.

Proof requirements

What are the burdens of proof for establishing infringement, invalidity and unenforceability of a patent?

A patentee bears the burden of proving the infringement of the patent, whereas a party challenging a patent bears the burden of proving invalidity or unenforceability. Although the Korean Patent Act does not specifically provide a presumption of validity, a patent claim granted after substantive examination by the examiner is presumed to be valid. As the district court has no power to declare patent invalidity, it may simply refuse to enforce the patent when a serious doubt has been raised as to a patent’s validity. A patent invalidity shall be litigated before the IPTAB, not a district court.

In limited circumstances, a patentee can be relieved of the burden of establishing infringement and a burden of establishing non-infringement is placed on the alleged infringer. This occurs in cases involving a patented process for making a product that has not been known to the public on the filing date of the subject patent application. This provision reflects implementation of both sub-paragraphs (a) of TRIPS article 34.1.

In addition, the accused infringer who denies the act of infringement which is claimed by a patentee or an exclusive licensee, can be required to produce his or her actual products or process.

Standing to sue

Who may sue for patent infringement? Under what conditions can an accused infringer bring a lawsuit to obtain a judicial ruling or declaration on the accusation?

An exclusive licensee, who is not necessarily a co-plaintiff with the patentee, as well as a patentee or any successors to title in the patent may sue for patent infringement.

An action for declaratory judgment of infringement may be brought before the IPTAB by a patentee or an exclusive licensee. On the other hand, an accused infringer can bring an action before the IPTAB for declaratory judgment of non-infringement without having to wait for the patentee to bring an infringement action. The requirement for a declaratory judgment action for non-infringement is lenient. The complainant for non-infringement could simply show the complaining party is in the same business area as the patent claim defines and has a plan to make, use or sell a related product. That party does not need to have engaged in activity that could constitute infringement or have made meaningful preparations to engage in such activity. An actual controversy between the parties at the time the action is initiated is not required. The requirement for a declaratory judgment for infringement is not as liberal as in the case of a non-infringement declaration. The plaintiff must specify the alleged infringing product or process to an extent that can be compared to the claims of the subject patent and show the defendant has a plan to exploit it. Assuming the conditions for bringing an action are met, the plaintiff may seek a declaratory judgment of non-infringement, invalidity or unenforceability or a combination of the above. A patentee facing a declaratory judgment claim will typically argue for infringement. Conversely, a party sued for infringement will typically initiate a declaratory judgment of non-infringement or invalidity.

The Green List

As an implementation of the Korea-US Free Trade Agreement, a list of patents (the Green List) covering approved drug products is available. Applications by the patentees and examination and approval thereon have been made before the Ministry of Food and Drug Safety. The owner of a listed patent may sue someone who applies for regulatory approval of the equivalent generic drug and request stay of sales of the generic drug within 45 days from the generic notification date. A generic applicant may file an action for declaratory judgment of non-infringement or invalidity in order to obtain a first generic exclusivity even before filing an application for regulatory approval of a generic drug.

The Korean Patent Act also provides an exemption from infringement claims for the use of a patented invention solely for experimental use including applying for an Abbreviated New Drug Application for a generic drug.

Inducement, and contributory and multiple party infringement

To what extent can someone be liable for inducing or contributing to patent infringement? Can multiple parties be jointly liable for infringement if each practises only some of the elements of a patent claim, but together they practise all the elements?

A patent can be infringed when a person performs activities satisfying all the elements required as defined in a patent claim (the ‘all elements rule’). In addition, when a person performs activities satisfying some elements defined in a patent claim and the remaining elements of the patent claim are performed by another, and as a result the patented invention is performed by two (or more) persons, the two performers may be liable for a patent infringement as a joint tortfeasor.

The Korean Patent Act prescribes that one is liable for contributory infringement when making, offering for sale, selling or importing a product that may be used solely for manufacturing a patented device. When a patent claim defines a process or method, the same rule applies to a product that may be used solely for exploiting the patented process or method.

The above provisions of the Korean Patent Act are understood to exclude supplying staple products from contributory infringement by limiting the product as being used solely for manufacturing the patented device. It is not explicitly prescribed whether a direct infringement is a prerequisite to establishing a contributory infringement. This issue matters since the liability of patent infringement requires exploitation of a patent to be ‘commercial’ activity. When the patented product is employed for personal use, rather than for a commercial use, supplying the patented device is not liable as patent infringement. In addition, the Korean Supreme Court has held that in order to construct a contributory infringement, the production act in ‘solely for manufacturing the patented device’ is required to be performed domestically.

Joinder of multiple defendants

Can multiple parties be joined as defendants in the same lawsuit? If so, what are the requirements? Must all of the defendants be accused of infringing all of the same patents?

Requirements for joinder of multiple defendants are quite generous under the Code of Civil Procedure: the defendants are liable based on the same legal reason of right or obligation or on the common factual bases. The result of a multiple defendants lawsuit need not be the same for all parties and may vary from one party to another.

To avoid any possible risk of putting all eggs in one basket, in Korean practice, plaintiffs prefer to file separate lawsuits first and later incorporate the lawsuits into one lawsuit, if allowable.

Infringement by foreign activities

To what extent can activities that take place outside the jurisdiction support a charge of patent infringement?

Infringement of a Korean patent generally requires making, using, offering to sell or selling a patented invention in Korea or importing a patented invention into Korea. In the case of a method patent, however, the patent laws can extend their reach to extraterritorial activity. Under the Korean Patent Act, a patented claim defining a method of making a product is deemed to extend to a product made by the patented process.

Thus, it is an act of infringement to import into Korea or sell or use within Korea a product made by the process patented in Korea even though the process might have been performed outside Korea.

Moreover, the Korean Supreme Court held that even if some components of the patented invention are assembled outside of Korea, the patented invention may still be infringed if it is determined that the product of the patented invention is substantially produced in Korea.  To be substantially produced in Korea, all or substantially all components for the product of the patented invention should be manufactured in Korea or most of the major processing should be done on the unfinished products; all or substantially all components or the unfinished products should be exported to a single entity for final assembly or processing; and the product can achieve the effect of the patented invention through trivial final processing on the unfinished product or simple assembly, combining the elements of the patented invention.

Infringement by equivalents

To what extent can ‘equivalents’ of the claimed subject matter be shown to infringe?

Korean courts recognise a rule that a product or process that does not literally include exactly the same elements as defined in a patented invention may still be found to infringe if the difference between the elements of the patented invention and the accused product or process is not substantial under the Doctrine of Equivalents (DOE). Infringement under the doctrine of equivalents requires that each element of a claimed invention be found in the accused product or process, either literally or by a substantial equivalent.

The traditional approach adopted in Korea to understand and evaluate a patented invention is based on three aspects: structure, function and effect of the claimed invention.

Since the doctrine of equivalents is invoked when the two elements, one as defined in the patented claim and the other as found in the accused product or process, are not identical (in structure), the comparison of the two elements tends to focus on the function and effect aspects, rather than structure aspect.

Finding infringement by equivalents is limited by certain rules. First, DOE is not applicable to a product that was known in the prior art or that is easily conceivable thereof by a person skilled in the art. Second, DOE is not allowed to reintroduce a device that has been intentionally excluded from the scope of patent claims during the patent prosecution process.

Discovery of evidence

What mechanisms are available for obtaining evidence from an opponent, from third parties or from outside the country for proving infringement, damages or invalidity?

According to the Korean Code of Civil Procedure, when deemed that unless an investigation of evidence is conducted in advance, there will be a situation that may make it difficult to use the relevant evidence later, the court may, upon request of a party, investigate the evidence. If such a request is granted, the court will investigate the evidence even prior to the filing of a complaint of infringement lawsuit. The grant of the request is limited to cases where it would not be possible to investigate evidence later.

To prove patent infringement, the patentee usually relies on publicly available evidence at the time of filing complaints, since evidence controlled by the opponent is difficult to obtain before a lawsuit. Once a party shows a reasonable ground for the court to believe the opponent or a third party controls relevant information, the court may issue, upon the party’s request or ex officio, an order to the person who controls the evidence to submit it.

The Code of Civil Procedure provides a variety of mechanisms for obtaining evidence from adverse parties in a lawsuit. Mechanisms to collect evidence, via filing a motion with the court during the litigation procedures, include the live examination of witnesses, requests for production of documents and requests for inspections of premises. To facilitate a party’s investigation with the opponent’s written evidence, the party may file a motion asking the opponent to submit a list of related documents under his or her control or that are planned to be introduced as evidence by the opponent.

The most common mechanism for obtaining third-party discovery is material requests ordered by a court upon the motion of a party. But the motion must specify the material to be produced and the person or entity from whom such a discovery is sought.

According to the Korean Patent Act, if certain evidence is deemed necessary to verify an infringement or damages, the alleged infringer is not justified in refusing to submit such evidence by asserting that the evidence requested is a trade secret. The court will, however, attempt to prevent a trade secret from being disclosed as much as possible by limiting the scope of the evidence disclosed and persons accessible to the evidence. In addition, if the alleged infringer does not respond to the court’s order to submit evidence without a justifiable reason, the opposing party’s arguments regarding facts that can be proven based on the requested evidence may be deemed to have been proven. Under the pre-revised Patent Act, it was difficult to enforce the court’s order to submit evidence if the alleged infringer asserted that the evidence was a trade secret even though the evidence was crucial information for verifying an infringement or damages. However, the revision of the Patent Act in this regard is expected to ease the process of verifying patent infringements and assessing damages in patent infringement actions.

Litigation timetable

What is the typical timetable for a patent infringement lawsuit in the trial and appellate courts?

The average duration of a patent infringement suit from the filing of a complaint to entry of judgment varies, and depends upon the complexity of the case and the court at which the case is filed. The Seoul Central District Court has heard the largest number of patent cases and has developed institutional expertise in patent cases, and an infringement suit before that court can be resolved within 12 to 18 months. In addition, it takes about eight to 12 months for the Patent Court to determine a patent appeal case.

Litigation costs

What is the typical range of costs of a patent infringement lawsuit before trial, during trial and for an appeal? Are contingency fees permitted?

The costs associated with patent infringement litigation vary widely depending upon many different factors, including the complexity of the technology, the parties, litigation strategy and the court to which the case is brought. For an infringement case of normal complexity, the estimated cost before trial ranges from US$10,000 to US$100,000, and the total estimated cost inclusive of trial is between US$50,000 and US$1 million. These amounts are only a rough estimation and many of the lawsuits naturally involve greater cost. This is especially true for cases involving multiple patents or cases involving very complex technology.

The Supreme Court held in Case No. 2015 Da 200111 (23 June 2015) that a contingency fee agreement in a criminal case is void against public policy or morality. Therefore, a contingency fee agreement is permitted only in civil cases.

Court appeals

What avenues of appeal are available following an adverse decision in a patent infringement lawsuit? Is new evidence allowed at the appellate stage?

The Patent Court has jurisdiction over appeals of judgments in patent infringement lawsuits. However, appeals of preliminary attachment or preliminary injunction judgments are heard by appellate divisions of the district court if the preliminary attachment or preliminary injunction request was dismissed, or the High Court in one of the six large cities within which the district court resides if the preliminary attachment or preliminary injunction request was granted. For patent invalidity decisions as well as declaratory judgments made by the IPTAB, all appeals are heard before the Patent Court. All final decisions rendered by the Korea International Trade Commission are subject to appeal at the Seoul Administration Law Court.

Appeals from decisions of the High Court or the Patent Court may be heard by the Supreme Court. The Supreme Court may decide to refuse to deliberate within four months from the date of lodging a notice of appeal to the Supreme Court.

The party can submit new evidence at the appellate stage. In this case, if the court determines that the party has submitted new evidence in bad faith or as a result of gross negligence to delay the appellate proceedings, the new evidence will not be considered. However, it is not possible to submit new evidence to the Supreme Court.

Competition considerations

To what extent can enforcement of a patent expose the patent owner to liability for a competition violation, unfair competition, or a business-related tort?

The Monopoly Regulation and Fair Trade Act provides a general exemption of patent enforcement from competition law. A patent gives its owner the right to exclude others from exploiting the patented invention without authorisation. However, in certain cases actions taken pursuant to enforcement of a patent can expose the patentee to competition law-based claims.

A patentee may face antitrust liability if an infringement suit is objectively baseless, such as where the patentee knows the asserted patent is invalid or unenforceable and is motivated to impose anticompetitive injury on the defendant. In relation to competition considerations of patent enforcement, the Fair Trade Commission has promulgated the Guidelines for Intellectual Property Enforcement and Competition Law.

Claims of unfair competition may be raised where a patentee sends a cease-and-desist letter or any other threatening notice of patent rights to customers of a competitor. Facts tending to support the bad faith include threatening infringement suits without any intention of filing a suit, sending indiscriminate infringement notices to all members of a trade and publishing a patent without a good-faith belief in its validity or enforceability.

Alternative dispute resolution

To what extent are alternative dispute resolution techniques available to resolve patent disputes?

The common forms of alternative dispute resolution for resolving patent disputes in Korea are mediation and arbitration. The KIPO has established and operates the Industrial Property Dispute Mediation Committee for patent, trademark and design rights. For arbitration, the Korean Commercial Arbitration Board has been established for various commercial disputes for internal and international trade disputes including patent infringement disputes. This institution does not specialise in patent disputes, but has been established for a long time.

Moreover, the revised Act on Persons Performing the Duties of Judicial Police Officers and the Scope of their Duties (Judicial Police Duties Act) came into effect on 19 March 2019.  The Judicial Police Duties Act has greatly expanded the scope of duty of the Special Judicial Police (SJP) within the KIPO to conduct investigations in connection with violations involving trademark, patent and design infringement, and trade secret misappropriation. The SJP system authorises administrative officials to take the same role as general police officers in directly investigating a crime in a certain professional field or a crime occurring in a specific space.  With this revision, it is expected that the KIPO will be able to more effectively enforce intellectual property rights.

Scope and ownership of patents

Types of protectable inventions

Can a patent be obtained to cover any type of invention, including software, business methods and medical procedures?

A method for the medical operation, treatment or diagnosis of diseases in human beings, namely, a method relating to medical procedures, is deemed to lack industrial applicability and, therefore, is not eligible for patent protection. However, a medical instrument or medicine for use in the medical operation or diagnosis of diseases in human beings is deemed to be industrially applicable and patentable.

The Korean Patent Act does not explicitly prescribe whether a business method or software is patentable. Thus, a business method or software is patentable, as long as the statutory requirements for patentability (the nominal definition of what constitutes an invention, industrial applicability, novelty, inventive step, etc) are met. A business method or software is deemed to comply with the nominal definition of what constitutes an invention, that is, ‘a highly advanced creation of a technical idea using the laws of nature’, if information processing by software is implemented by hardware resources. Such implementation of information processing should be stated in the claim in order to be patent-eligible. In particular, software inventions can be protected by claims for a computer program (or an application) stored in a medium.

Further, claims directed to a program signal, a data signal or a computer program list and claims that involve human acts, economic rules, artificial decisions, mathematical algorithms or human mental processes are not allowable for patent protection.

Patent ownership

Who owns the patent on an invention made by a company employee, an independent contractor, multiple inventors or a joint venture? How is patent ownership officially recorded and transferred?

According to the Korean Invention Promotion Act, an employee who has made an invention as an employee has a right to obtain a patent for the invention. When the employee acquires a patent right, the employer who hires the employee will be entitled to a non-exclusive licence for the patent right because of his or her contribution to the completion of the employee invention. The employer may require the employee to transfer the right to obtain a patent, the patent right, etc, in advance or to grant an exclusive licence for the patent right where there is a contractual agreement or employment regulations. Further, the employee will have a right to receive fair compensation, if he or she has agreed to transfer the rights of the employee invention to the employer or to grant an exclusive licence to the employer according to a contractual agreement or the employment regulations.

Where two or more persons jointly make an invention, they are entitled to jointly own the right to obtain a patent.

If an independent contractor is an inventor, the right to the patent belongs to the independent contractor, unless there are any other contractual obligations.

In the case of a joint venture, if there is an agreement regarding patent ownership between the joint venture and the companies who established the joint venture, the ownership of the patent right will be determined according to the agreement.

Transfer of patent ownership through inheritance or other general succession will automatically take effect if the requirements prescribed under the law are met (no separate steps to record the transfer are required). However, a transfer of patent ownership through an assignment will only be effective upon recordal of such a transfer with the KIPO.

If a decision invalidating the registration of a patent becomes final and conclusive on the basis that the application was filed by a person that is not entitled to obtain a patent, a corresponding application filed by one entitled to obtain a patent within 30 days from the date the invalidation decision becomes final and conclusive shall be deemed to have been filed on the filing date of the application filed by the unentitled person. In addition, where an application filed by an unentitled person is granted a patent, a person who is entitled to obtain the patent can request the court to transfer the patent.

Defences

Patent invalidity

How and on what grounds can the validity of a patent be challenged? Is there a special court or administrative tribunal in which to do this?

To challenge the validity of a patent, an invalidation action can be filed with the Intellectual Property Trial and Appeal Board (IPTAB) of the Korean Intellectual Property Office (KIPO). Only an interested party or an examiner can request an invalidation trial. An invalidation trial can be requested for each patent claim.

A patent claim can be invalidated on any of the following grounds:

  • where the claimed invention does not comply with the nominal definition of what constitutes an invention, or lacks industrial applicability, novelty or inventive step, or is not patentable under the first-to-file rule;
  • where the claimed invention is liable to contravene public order or morality or to injure public health;
  • where the specification does not describe the invention in a manner sufficiently clear and complete to enable a skilled person to readily carry it out;
  • where the claim is not supported by the specification;
  • where the claim does not clearly and concisely define the invention;
  • where the patent application was filed by a person who is not the inventor or his or her successor;
  • where the patent application was not jointly filed by co-owners, in the case that the patent is jointly owned;
  • where the patent was acquired by an employee of the KIPO or the IPTAB during employment at the office or tribunal, other than in cases of inheritance or bequest;
  • where the patent was granted in violation of the rules of the Treaty;
  • where amendments were made to the specification or drawings beyond the scope disclosed in the originally filed specification and drawings; or
  • where a divisional application or a converted application was filed beyond the scope disclosed in the originally filed specification and drawings.

 

A decision by the IPTAB can be appealed to the Patent Court, and a decision by the Patent Court can be appealed to the Supreme Court.

In addition, any person can request the cancellation of a registered patent to the IPTAB by submitting prior arts that were not cited during the examination, during the period from the registration date to six months after the publication of the patent.

Absolute novelty requirement

Is there an ‘absolute novelty’ requirement for patentability, and if so, are there any exceptions?

In Korea, absolute novelty is required for patentability.

However, inventions publicly known or worked in or outside Korea, disclosed in a publication distributed in or outside Korea, or made available to the public through telecommunication lines as prescribed by presidential decree may be deemed to have novelty if a patent application for the invention is filed within 12 months from such disclosure of the invention, claiming the benefit of the novelty grace period:

  • at the time of filing the application;
  • within the time frame for filing an amendment; or
  • from the date of receipt of a Notice of Allowance to the earlier of three months thereafter or the payment of an issuance fee.

 

The 12-month grace period is also applicable where the invention is disclosed against the intention of a person with the right to obtain a patent.

Obviousness or inventiveness test

What is the legal standard for determining whether a patent is ‘obvious’ or ‘inventive’ in view of the prior art?

Where an invention could have been easily conceived by a person having ordinary skill in the art to which the invention pertains, based on the prior art publicly known or worked in or outside Korea, disclosed in a publication distributed in or outside Korea, or made available to the public through telecommunication lines as prescribed by presidential decree prior to the filing of a patent application for the invention, such an invention is deemed to be obvious in view of the prior art.

Obviousness is determined in consideration of whether the prior art teaches or suggests the invention claimed in a patent application, whether the prior art and the claimed invention are identical in terms of their objectives or functions or effects and whether the prior art and the claimed invention are identical or similar in terms of their technical fields.

Where the claimed invention produces a remarkably superior effect in comparison to the prior art, such an effect is positively considered in determining the inventive step of the invention.

Patent unenforceability

Are there any grounds on which an otherwise valid patent can be deemed unenforceable owing to misconduct by the inventors or the patent owner, or for some other reason?

In Korea, a valid patent will be unenforceable under the good faith principle of the Civil Act if the enforcement of the patent is deemed as an abuse of the patent right. According to court decisions in Korea, when a patent is apparently deemed to lack novelty or an inventive step, the patent is unenforceable even before the invalidation of the patent is concluded.

If an act of working a patent falls under any of the unfair trade practices prescribed in the Fair Trade Act (eg, filing a patent infringement lawsuit while being aware of the invalidity of the patent), the patent enforcement will be restricted so as not to violate the Fair Trade Act, and the patentee will be liable to pay a fine levied by the Fair Trade Commission.

Prior user defence

Is it a defence if an accused infringer has been privately using the accused method or device prior to the filing date or publication date of the patent? If so, does the defence cover all types of inventions? Is the defence limited to commercial uses?

An act of privately using an accused method or device is not a commercial use that may constitute a patent infringement. If an accused infringer has been commercially using the accused method or device prior to the filing of the patent, the accused infringer may assert the prior user rights defence to patent infringement.

Under the Korean Patent Act, a person, who, without knowledge of the content of an invention claimed in a patent application, made an invention identical to the said invention or learned the invention from a person who made an invention identical to the said invention and has been working the invention or making preparations to work the invention in Korea at the time of the filing of the patent application, is entitled to have a non-exclusive licence (prior user right) on the patent right within the scope of the objective of the invention or the business related to the invention that the person is working or making preparations to work.

‘Preparations to work’ the invention mean substantial preparations to conduct business based on the invention, including purchase of a plant site or business facilities.

The prior user rights defence covers all types of inventions.

In the case where a patent based on an application filed by an unlawful person is transferred to the proper person upon a request, if a patentee, an exclusive licensee or a non-exclusive licensee before the transfer is practising or preparing to practise the patented invention in Korea without being aware that the application was filed by an unlawful person, he or she may be deemed to have a non-exclusive licence for the patent.

Remedies

Monetary remedies for infringement

What monetary remedies are available against a patent infringer? When do damages start to accrue? Do damage awards tend to be nominal, provide fair compensation or be punitive in nature? How are royalties calculated?

Monetary damages can be awarded to a patentee (or exclusive licensee) when its patent is found to be valid and infringed and the patentee loses its profits as a result of the infringement. The damages are intended to fairly compensate the patentee for losses suffered as a result of the infringement. A patentee is entitled to its lost profits on all lost sales resulting from the infringement if the patentee can show that, but for the infringement, the patentee would have made the sales that the infringer made. Accordingly, the patentee must show demand for the product in the market and sufficient capacity to make non-infringing products.

When there are losses caused by the infringer’s sale of infringing products, but the actual lost profits are not easily proven, the amount of losses may be calculated by multiplying the number of sold products by the profit per unit of the product that the patentee might have sold but for the infringement. In such cases, the damages may not exceed an amount calculated by multiplying the estimated profit per unit by the amount obtained from subtracting the number of products actually sold from the number of products that the patentee could have produced. However, if the patentee was unable to sell his or her product for reasons other than by infringement, a sum calculated according to the number of products subject to the said circumstances shall be deducted.

The profits gained by the infringer as a result of the infringement shall be presumed to be the amount of damages suffered by the patentee.

The pecuniary amount of reasonable royalty to which the patentee would normally be entitled may be claimed as the amount of lost profits of the patentee. Notwithstanding, if the amount of losses exceeds the amount of the reasonable royalty, the amount in excess may also be claimed as damages. In such cases, the court may take into consideration whether or not there has been wilfulness or gross negligence on the infringer when awarding damages. There is no provision on the calculation of a reasonable amount of royalty under the Patent Act. However, the Supreme Court held in Case No. 2003 Da 15006 (27 April 2006):

An amount of royalty generally payable to a patented invention must be objectively and reasonably calculated in consideration of various factors found prior to the conclusion of the case, such as the objective technical value of the patented invention, the terms and conditions of a licence agreement with a third party in connection with the patented invention, the terms and conditions of a previous licence agreement with the infringer in connection with the patented invention, an amount of royalty generally payable to the same type of invention as the patented invention in the art, the remaining patent term, the type of use of the patented invention by the patentee, the existence of a technique equivalent to the patented invention, the infringer’s profit earned, etc.

 

Nevertheless, if the nature of the facts of the case makes it difficult to provide evidence proving the amount of losses, the court may determine a reasonable amount on the basis of an examination of the whole circumstances.

Damages start to accrue from the time the infringement begins. When the alleged infringer knows or is notified of the published application prior to the issuance of a patent, a reasonable royalty may start accruing from the time of knowledge or notification of a patent application publication. The reasonable royalty can be claimed only after the issuance of the patent.

Regulations for ‘Punitive Damages’, applicable to patent infringements occurring after 9 July 2019, allow the courts to award punitive damages up to treble the actual damages for a wilful infringement of a patent right or an exclusive licence thereof, thereby strengthening the remedy of the damages caused by the infringement of a patent right or an exclusive licence. In determining whether to award punitive damages, the court would consider, among other things, whether the infringer was in a superior position, the degree of wilfulness, the duration and number of times the infringement took place, and the economic benefits obtained by the infringer owing to the infringements.

Injunctions against infringement

To what extent is it possible to obtain a temporary injunction or a final injunction against future infringement? Is an injunction effective against the infringer’s suppliers or customers?

A patentee (or exclusive licensee) can request a preliminary or permanent injunction against a person who infringes or is likely to infringe on his or her own patent right. A patentee can demand the measures necessary to prevent the infringement.

To obtain a preliminary injunction, the patentee must show a likelihood of success on the merits for the validity of the patent and infringement. In deciding whether to grant a preliminary injunction, the court must also take into consideration the balance of hardships between the parties, the prospects of irreparable harm to either party, and the public interest.

Both preliminary and permanent injunction apply only to the defendant. Thus, an injunction is not effective against the infringer’s suppliers or customers.

Banning importation of infringing products

To what extent is it possible to block the importation of infringing products into the country? Is there a specific tribunal or proceeding available to accomplish this?

The Korea Trade Commission (KTC) is a government agency that investigates unfair acts of importation, sale, exportation and manufacture for export of a product infringing on intellectual property rights and has the authority to issue temporary relief or corrective measures including a penalty. Patentees can file a complaint with the KTC claiming a patent infringement. The KTC will then undertake an investigation, which is generally completed within six months. In principle, the investigation is a documentary-based proceeding between the two parties, namely, complainant or patentee and respondent or accused infringer, and a hearing for the investigation can be requested. Ex officio investigation is also possible.

A patentee who is injured or threatened with irreparable injury due to unfair international trade practices that are under investigation is allowed to apply for a provisional suspension of the unfair practices in question, or other measures to prevent the injuries.

At the conclusion of the investigation proceedings, the director general of the Office of Investigation issues an initial determination on whether there has been a violation of an intellectual property right and a recommended determination on what the remedy, if any, should be. These determinations are forwarded to the KTC, which issues a final decision as to whether there is a violation and imposes a remedy, if required. If a violation is found, the KTC can issue a temporary relief or corrective measure to interdict shipments of infringing products at ports of entry into Korea, or it could provide permanent relief by destroying the infringing products or imposing a penalty, or both.

An order for a corrective measure or penalty can be appealed to a Seoul administrative court, and is effective against third parties importing the same product as the infringing product, through a confirmation procedure.

Attorneys’ fees

Under what conditions can a successful litigant recover costs and attorneys’ fees?

Although the prevailing party in patent infringement litigation can ordinarily recover costs for the proceeding including court fees and attorneys’ fees from the losing party, the recoverable attorneys’ fees are limited to the amount calculated based on a statutory fee schedule, which is nominal. Litigation cost is determined in a separate proceeding.

Wilful infringement

Are additional remedies available against a deliberate or wilful infringer? If so, what is the test or standard to determine whether the infringement is deliberate? Are opinions of counsel used as a defence to a charge of wilful infringement?

An additional civil remedy is not available against a deliberate or wilful infringer. However, a criminal remedy is available against a deliberate infringer. Meanwhile, in Korea, opinions of counsel may be used as reference in refuting wilful infringement, but are not legally binding.

Time limits for lawsuits

What is the time limit for seeking a remedy for patent infringement?

Damages in a patent infringement case cannot be claimed if they are not exercised by the patentee or other relevant rightholders within three years from the time when they first knew of the damages and the identity of the infringer. After the extinctive prescription of three years has passed, unjust enrichment can be claimed against the patent infringement. The 10 years of extinctive prescription for a claim of unjust enrichment will have elapsed from the time of the infringing act.

Patent marking

Must a patent holder mark its patented products? If so, how must the marking be made? What are the consequences of failure to mark? What are the consequences of false patent marking?

There is no obligation to mark patented products in Korea. However, if someone falsely marks a product as patented; assigns, leases or displays a falsely marked product; or indicates a product as patented on advertisements, signboards or tags when the product is not covered by the patent claims or the listed patent has expired, that person can be subject to a fine of no more than 30 million Korean won or imprisonment of no more than three years.

Licensing

Voluntary licensing

Are there any restrictions on the contractual terms by which a patent owner may license a patent?

In principle, the terms and conditions of licensing contracts are the responsibility of the contracting parties only and can be chosen by them. However, the terms of the contract have to comply with the Korean antitrust regulations. There are some restrictions on voluntary licences for patents. For example, the term of a patent licence cannot extend beyond the expiry dates of the licensed patents. Also, restrictions on price, restrictions on transaction of competing products and tying of non-patented products are impermissible. Further, the Korea Fair Trade Commission has added examples of patent misuse, for example, avoiding disclosure of related patent applications or issued patents in order to increase the likelihood of selection of a patent as a technology standard or avoiding pre-negotiation on the licensing terms and conditions of a patented invention, rejecting permission to license a patented invention widely used as a technology standard, filing a patent infringement action in order to harm another party’s competitiveness, knowing that the patent is invalid or agreeing to keep an invalid patent in force to delay a competitor’s entry into the market.

Compulsory licences

Are any mechanisms available to obtain a compulsory licence to a patent? How are the terms of such a licence determined?

A compulsory non-exclusive licence can be granted by the Korean Intellectual Property Office (KIPO) in the following circumstances:

  • when the patented invention has not been worked for more than three consecutive years in Korea, except for reasons of natural disasters, unavoidable circumstances or other justifiable reasons and a negotiation with the patent proprietor regarding a voluntary licence under reasonable terms has been unsuccessful;
  • when the patented invention has not continuously been worked commercially or industrially in Korea on a substantial scale during a period of three years or more without justification, or the domestic demand for the patented invention has not been satisfied to an appropriate extent and under reasonable conditions and a negotiation with the patent proprietor regarding a voluntary licence under reasonable terms has been unsuccessful;
  • when the patented invention is necessarily practised for the interests of the public;
  • when the patented invention is necessarily practised to remedy a practice determined to be unfair after the judicial or administrative process; or
  • when the patented invention is necessarily practised for exporting medicines to countries intending to import the medicines to cure diseases that threaten the health of the majority of its citizens.

 

Aside from compulsory licences, the Korean Patent Act provides a prior use right and an intervening right in certain circumstances. A person who has made an invention without prior knowledge of a patent application (or who has learned about the invention from such a person) and has been practising the invention commercially or industrially in Korea in good faith or has been making preparations to practise the invention, is entitled to a non-exclusive licence on the patent right for the invention under the patent application. The non-exclusive licence must be limited to the invention being worked, or for which preparations for working have been made and to the purpose of such working or preparations. When a patent that was concluded to be invalid has been restored by a retrial and a person has, in good faith, commercially or industrially, practised the invention in Korea, or has been making preparations to practise the invention, after a trial ruling becomes final but before a request for a retrial, he or she is entitled to have a non-exclusive licence on the patent right. The scope of the non-exclusive licence is limited to the purpose of the business and the scope of the invention being practised, or for which preparations for practising are being made.

Patent office proceedings

Patenting timetable and costs

How long does it typically take, and how much does it typically cost, to obtain a patent?

In view of the current pace of examination at the Korean Intellectual Property Office (KIPO), it takes approximately 12 months to receive the examination results after a request for examination is filed. Accordingly, assuming that an office action, such as a preliminary rejection, is issued, it takes approximately 20 months to obtain a patent in Korea.

Legal fees for preparing and filing a patent application generally range from US$2,500 to US$7,000 in inbound cases depending on the amount of text to be translated, and from US$2,000 to US$3,500 in domestic cases, depending on the complexity of an invention. When filing a patent application with the KIPO, official fees, which include a basic fee of US$38 and additional fees of US$20 for each priority, must be paid. In addition, when filing a request for examination, official fees, including a basic fee of US$130 and additional fees of US$40 for each claim, must be paid.

After a notice of allowance is issued, in order to register a patent, the applicant must pay the first three years’ annuities in a lump sum, which includes a basic fee of US$45 and additional fees of US$39 for each claim.

If any official notification is issued by the KIPO, legal fees for responding thereto will be additionally incurred.

Expedited patent prosecution

Are there any procedures to expedite patent prosecution?

In Korea, a request for expedited examination may be filed concurrently with or after filing a request for examination of a patent application for the following patent applications:

  • applications for an invention that has been commercially worked by a third party after the publication of the application;
  • applications that require expedited prosecution as specified in the statute for which a party who would like to request expedited examination submitted a prior art search report to the KIPO;
  • applications that are eligible for requesting expedited examination under the Patent Prosecution Highway (PPH) programme between the KIPO and a corresponding foreign patent office;
  • applications for which a prior art search has been conducted by one of the institutes authorised by the KIPO and it is requested to submit the prior art search report to the KIPO; and
  • applications for an invention relating to the fourth industrial revolution (eg, artificial intelligence or the internet of things).

 

The PPH programme enables patent applicants to request fast-track examination for applications, such that the examiners of the KIPO can utilise the work product from foreign patent offices. The IP5 patent offices, including the European Patent Office (EPO), the Japan Patent Office (JPO), KIPO, the China National Intellectual Property Administration (CNIPA), and the US Patents and Trademark Office (USPTO), initiated a new PPH pilot programme, and patent offices in 26 countries, including the JPO, KIPO and USPTO, initiated a Global PPH programme. The IP5 PPH programme and the GPPH programme replace any existing PPH programmes between the KIPO and the offices participating in the IP5 and global PPH programmes.

Patent application contents

What must be disclosed or described about the invention in a patent application? Are there any particular guidelines that should be followed or pitfalls to avoid in deciding what to include in the application?

A patent application must accompany the specification, claims, drawings and abstract.

In the specification, a claimed invention should be clearly and sufficiently described to the extent that the invention could be easily practised by anyone with ordinary skill in the art.

The background art of the invention must be described in the specification. Non-compliance with such a requirement may serve as a basis for rejection, but not for invalidation.

The applicant may defer filing claims until 14 months from the earliest priority date or, if no priority is claimed, from the effective filing date of the patent application.

The applicant may submit the specification, claims and drawings in English when filing a Korean patent application in order to secure an effective filing date of the Korean patent application. A Korean translation of the specification, claims and drawings must be submitted within 14 months from the earliest priority date.

In addition, patent applications may be filed simply with invention disclosures such as scientific publications in Korean or foreign journals or research notes, without a need of complying with complex formal filing requirements. A specification can be drafted in English, which allows English publications to be filed directly, thereby making it possible to secure an earlier filing date. In this case, the Korean-language specification must be filed within 14 months from the earliest priority date.

Prior art disclosure obligations

Must an inventor disclose prior art to the patent office examiner?

The background art of the invention must be described in the specification. The background art of the invention refers to conventional art that may be helpful in understanding a claimed invention and useful in conducting a prior art search or examination. Unlike the information disclosure statement system in the United States, such a requirement does not impose a duty on the applicant to disclose all the information known to individuals associated with the filing and prosecution of the patent application.

Pursuit of additional claims

May a patent applicant file one or more later applications to pursue additional claims to an invention disclosed in its earlier filed application? If so, what are the applicable requirements or limitations?

It is possible to pursue additional claims for an invention that is disclosed in a parent application in a divisional application, which would be deemed to have the same effective filing date as the parent application. Divisional applications may be filed within the scope of the originally filed specification, claims and drawings of the parent application and within the following time frames:

  • at any time prior to the issuance of a first office action;
  • within the time period for responding to an office action/a final rejection, if any; and
  • from the date of receipt of a notice of allowance to the earlier of three months thereafter or the payment of an issuance fee.

The patent term of a divisional application is 20 years from the effective filing date of its parent application.

Patent office appeals

Is it possible to appeal an adverse decision by the patent office in a court of law?

The Patent Court has exclusive jurisdiction over all appeals of the decisions of the Intellectual Property Trial and Appeal Board (IPTAB) of the Korean Intellectual Property Office (KIPO).

If an appellant or appellee loses the appeal at the Patent Court, a final appeal at the Supreme Court may be requested.

Oppositions or protests to patents

Does the patent office provide any mechanism for opposing the grant of a patent?

Any person can request the cancellation of a registered patent to the IPTAB by submitting prior arts, which have not been cited during the examination, during the period from the registration date to six months after the publication of the patent. Since the cancellation procedure is an ex parte procedure between the patentee and the IPTAB, all proceedings will be based on written arguments once a request is made by a third party. Only the patentee can appeal the cancellation decision to the Patent Court and subsequently to the Supreme Court.

In addition, an interested party or an examiner may file an invalidation action to challenge the validity of a patent.

Priority of invention

Does the patent office provide any mechanism for resolving priority disputes between different applicants for the same invention? What factors determine who has priority?

The Korean patent system is based on the first-to-file rule. In cases where two or more patent applications have been filed with respect to the same invention, only an application having the earliest priority date or effective filing date is eligible to obtain a patent for the invention. The first-to-file rule is applicable regardless of whether the two or more applications are filed by the same applicant or not. If two or more applications having the same priority date or effective filing date relate to the same invention, only one application that has been selected upon mutual agreement by the applicants, or that has been selected by the applicant, is eligible to obtain a patent for the invention. If the applicant fails to select one application, none of the applications will be granted a patent.

Modification and re-examination of patents

Does the patent office provide procedures for modifying, re-examining or revoking a patent? May a court amend the patent claims during a lawsuit?

The patentee may request a trial to correct the specification, claims and drawings at any time after the issuance of a patent. A trial for correction of a patent may also be requested while a lawsuit involving the patent is pending. In such a case, the lawsuit may be suspended at the discretion of the court until the trial for correction is completed. A trial for correction of a patent may not be separately requested if an invalidation action is in process before the IPTAB. However, a request for correction of the specification, claims or drawings may be filed within the prescribed deadline during the invalidation proceedings.

The scope of corrections that are allowable in a trial for correction or a request for correction is restricted to narrowing the scope of the claims, correcting clerical errors and clarifying unclear descriptions. Further, a correction to substantially expand or modify the scope of the claims is not permitted. The subject matter sought to be protected in the claims after correction should be deemed to have been patentable at the time the application was filed.

Patent duration

How is the duration of patent protection determined?

The patent term is 20 years from the effective filing date of a patent application. However, the patent term may be extended to compensate for a period during which a patented invention could not have been worked due to a regulatory approval or registration, or a period during which the examination of a patent application is delayed by the KIPO.

Update and trends

Key developments of the past year

What are the most significant developing or emerging trends in the country’s patent law?

Online transmissions of software

According to the revised Patent Act (effective as of 11 March 2020), an act of online transmission of software that illegally utilises a patented invention may constitute a patent infringement.

A software invention comprising a patented technology is entitled to patent protection if it claims software in a form that is stored in a recording medium, such as a USB or CD. However, the pre-revised Patent Act did not provide an adequate patent protection for the transmission of software via an information and communication network without using a recording medium on the basis that that transmission of software is not an act of ‘working’ defined in the Patent Act.

This revision amended article 2(3) of the Patent Act to define the term ‘working’ in the case of a method invention as including an act of offering to use the method. Thus, under the revised Patent Act, online transmission of software comprising a patented technology is also eligible for patent protection. In addition, the revision added article 94(2) to the Patent Act, prescribing that if the working of a patented invention is an act of offering to use a method according to article 2(3), the patent right shall only be exercised against an act of offering to use the method while knowing that the use of the method infringes on the patent right or an exclusive licence thereof. Thus, patent protection is only available against an act of illegally distributing software while knowing that the act infringes on the patent right or an exclusive licence thereof.

 

Revision to the judicial police system related

The revised Act on Persons Performing the Duties of Judicial Police Officers and the Scope of their Duties (Judicial Police Duties Act) came into effect on 19 March 2019. The Judicial Police Duties Act has greatly expanded the scope of duty of the Special Judicial Police (SJP) within the Korean Intellectual Property Office (KIPO) to conduct investigations in connection with violations involving trademark, patent and design infringement, and trade secret misappropriation. 

The SJP system authorises administrative officials to directly investigate a crime in a certain professional field or a crime occurring in a specific space, with the same legal authority as a general police officer. With the revision, it is expected that the KIPO will be able to more effectively enforce intellectual property rights.

Law stated date

Correct on

Give the date on which the information above is accurate.

24 March 2020.