Piracy Problems in China

Cases

2. Microsoft (China) vs Beijing Yadu
On December 17, 1999, BFIPC issued its judgement on another landmark case, Microsoft Corporation (China), Ltd. vs. Beijing Yadu Science and Technology Group (hereinafter Yadu Group). This is the first time a major foreign software manufacturer went directly after an end user for copyright infringement in the PRC and the judgement came only three days after the Beijing Online case. Unlike Beijing Online, however, the BFIPC is the court of first instance. Having concluded the trial the court summarily dismissed plaintiff's complaint for lack of sufficient evidence. Specifically, the court held that the plaintiff misidentified Yadu Group as the defendant in its allegations. Microsoft (China) indicated that it would fight on by filing a new complaint against the proper defendant in the near future.

Analysis: During the legislative process of the 1990 Copyright Law, there was an internal debate regarding the necessity of having a set of additional rules specifically in dealing with the registration, protection and licensing aspects of computer software. Eventually those in favour carried the day and Article 53 was created to give the State Council the authority to do so. The State Council then promulgated the Regulations on Computer Software Protection on June 4, 1991. But the controversy did not end there. Microsoft case is a good example.

3. Domain Name disputes
On June 20, 2000, the Beijing Second Intermediate Court handed down its judgement concerning the domain name dispute over ikea.com.cn. In InterIKEA Systems (China), Ltd. vs. China International Network Corporation, Ltd. (CiNet), the court handed a total victory to InterIKEA and ordered defendant CiNet's registration of ikea.com.cn be terminated immediately because it has violated the plaintiff's well-known mark.

Analysis: The judgement of this case carries a strong signal that even for a company that has the full backing of the government such as the China International Network Corp Ltd, it is not exempted from infringement liability. This is the first domain name dispute in China that happens to involve a foreign firm and the question of well-known mark. This ruling established at least three precedents: (1) for the first time, a court in China declares that domain name dispute is a trademark issue; (2) for the first time, a court in its own rite decides what constitutes a well-known mark, opposed to leaving the task to the authority of State Administrative Department of Industry and Commerce; and (3) for the first time, the court combined application of Article 5, Section 2 Anit-Unfair Competition Law, Article 6 of the Paris Convention for the Protection of Industrial Property (on well-known mark), among other things, in reaching its conclusion. Although defendant has indicated its appeal, the outcome of this case could open the floodgate of many other similar cases.