ABE & Partners

Takanori Abe of Abe & Partners looks at a recent judicial decision concerning the Antimonopoly Act and considers the growing litigation of this area in Japan

Sumitomo Bakelite has manufactured and sold each device comprising a portable and disposable device for continuous low pressure suction or a set of these devices (collectively SB Bag) with the product name "SB Bag" since 1984. Those consisting of a drainage bottle and a suction bottle in SB Bag are the relevant products belonging to Sumitomo Bakelite in this case. Nippon Covidien has manufactured and sold its product since January 2018.

In the past, Japanese patent litigations were notorious for being slow, having narrow claim interpretation, low damages awards, poor evidence collection procedures, and having a low winning rate. Cases and Materials on Patent Law, Second Edition says, "No countries' patent system has received more criticism than that of Japan. Among the chief complaints is that the courts award patent claims with an extremely narrow scope, and that the Doctrine of Equivalents does not exist at all." Global Patent Litigation: How and Where to Win, Third Edition, edited by Finnegan says that the winning rate of patentees from 2006 to 2016 was 24% in Japan, ranked second from the bottom out of the 10 countries. However, Japanese patent litigation has been reformed and is now transformed in order to be more convenient for patentees than ever before.

The Fourth Industrial Revolution along with the spread of the IoT means that SEP licensing negotiations are expected to be held more often between SEP holders in the information and communication technology field and business entities in industries other than the telecommunications industry, especially multi-component products industries such as automobiles, game machines etc. However, risks involving SEP licensing negotiations and disputes have been increasing significantly because licensing negotiation practices and market views on royalties are very different between the above business entities and SEP holders. Being aware of such issues, the Ministry of Economy, Trade and Industry (METI) published the Guide to Fair Value Calculation of Standard Essential Patents for Multi-Component Products (the basic concept) on April 21 2020. The basic concept has been formulated based on the report (dated March 31 2020) of the Study Group on Fair Value Calculation of Standard Essential Patents for Multi-Component Products (report), commissioned by the Policy Planning and Coordination Division, Manufacturing Industries Bureau, the METI.

As of October 1 2019, the Tokyo District Court and the Osaka District Court started operating a new practice for mediation concerning IP rights (IP mediation). IP mediation is designed to solve disputes over IP rights in a simple and speedy way by obtaining opinions on the dispute, in principle, by the third mediation date, from the mediation committee composed of the judge of the IP division and experts such as lawyers and patent attorneys with vast experience in dealing with IP cases. IP mediation is a judicial service providing the third dispute resolution tool within the framework of existing laws. It is unique and different from litigation and provisional disposition.

(Praluent IF, page 78)