Civil action brought by Ying Hsiang Co., Ltd. (the plaintiff) against Ing Hsiang Co., Ltd. (the defendant) for damages caused by the defendant's act of publishing untrue public notice and circulating warning letters to the plaintiff's dealers and customers
Chinese Taipei
Case:
Civil action brought by Ying Hsiang Co., Ltd. (the plaintiff) against Ing Hsiang Co., Ltd. (the defendant) for damages caused by the defendant's act of publishing untrue public notice and circulating warning letters to the plaintiff's dealers and customers
Key words:
counterfeit, patent rights, damages, prescription (statute of limitation)
Reference:
Taiwan High Court Civil Judgment (84) Nien Shang Tzu No. 1242, 15 November 1995
Industry:
Information System Integration Service (7504)
Relevant Laws:
Summary:
The plaintiff (appllant) filed a civil action against the defendant (applellee) claiming the following:
The plaintiff and the defendant were both in the image-processing business. The defendant had obtained a new-utility-model patent right for its "computer image input\index\ comparing\printer device." Subject to Article 95 of the Patent Law, the defendant's patent right exists when all of the functions, i.e. computer image input, index, comparing, and printer, are combined together in a single device. Software and hardware equipment relating to computer image input, index, comparing and printing are not covered by the defendant's new-utility-model patent right.
However, the defendant published a sizable public notice in the 28 February 1992 China Times wherein it alleged that the “computerized seal-comparing machine (computer image input\index\comparing\printing device)” was a product of its new-utility-model patent. Also in the public notice, the defendant called for other companies of the same business and the customers to jointly fight against counterfeiters in order to vindicate its legal rights and interests. In the public notice, the defendant deliberately replaced the word “printer” with “printing” when describing its new utility model patent. Such description misled the general public to believe that the defendant's new-utility-model patent covers both the software program and the hardware of seal comparing device, and a product made by any person other than the defendant combining the computer image input\comparing\printing functions would constitute a counterfeit.
The defendant subsequently caused attorney's letters to be issued to the plaintiff's dealers and customers on 23 and 25 June, 21 and 27 July 1992. In the attorney letters, the defendant accused that part of the configuration of the plaintiff's on-line seal-comparing network system (hereinafter the System) had infringed upon its patent rights. The defendant demanded that the plaintiff, together with its dealers and customers, cease infringing the its patent rights by discontinuing sales of the System. Although the defendant had not specified the scope of its patent nor produced substantial evidence to prove its allegation of infringement, the plaintiff's dealers and customers followed one another to stop selling or buying the System in order to avoid possible lawsuits. Against the above acts of the defendant, the plaintiff brought a complaint to the Fair Trade Commission. As a result of its 87th Commission Meeting, the Commission issued a disposition against the defendant according to Articles 21 and 24 of the Law. Accordingly, the plaintiff was entitled to claim damages from the defendant pursuant to Article 31 of the Law. In addition, the defendant had injured the plaintiff's reputation by its act of publishing untrue public notice and circulating warning letters. Therefore, in accordance with Article 195 of the Civil Code, the plaintiff is entitled to claim that defendant restore its reputation by publishing a notice of apology in the same size in the China Times and sending correction letters to the same addressees of its previous attorney letters.
Nevertheless, Article 33 of the Law provides that “[t]he prescription for the claims of this chapter is two years starting from the date the claimant has the knowledge of the act and the liable person, and shall extinguish in any event ten years after the occurrence of the act.” The “act” refers to an act in violation of the Law. The Commission's investigation, review and disposition in relation to an alleged violation are based on an inquiry as to whether the act is in violation of the Law. For an act found to be in violation of the Fair Trade Law, the time of occurrence is the time the person commits the act. The date of this Commission's disposition shall have no effect on the time of the violation. The "knowledgeable-of-the-act" requirement is fulfilled when the person who has the right to claim learns of the act's violation of the Fair Trade Law, rather than at the time when this Commission issues a disposition. The plaintiff filed the complaint with this Commission against the defendant on 16 March and 3 July 1992. It could be inferred that the plaintiff had the knowledge that the defendant's act violated the Fair Trade Law. However, the plaintiff did not claim damages under Article 31 of the Fair Trade Law until 9 June 1995. The two-year period for the plaintiff to make its claim apparently lapsed. The defendant therefore brought the defense of prescription, which defeated the plaintiff‘s claim.
Article 197 of Civil Code also stipulates the prescription for tort claims: within two years after the date when the person who has the right to claim becomes knowledgeable of the person who commits the act of tort, and within ten years after the date the wrongdoes commited the act. The plaintiff's right to claim for restoration of its reputation under Article 195 of the Civil Code also extinguished with the expiration of the two-year period. The defendant had already defended on the ground of prescription. The plaintiff can no longer exercise its right. The plaintiff's right to claim having extinguished due to prescription, its claim in the instant case is therefore groundless and should not be granted. Accordingly, the district court judgment finding in favor of the defendant was not made in error. The plaintiff's appeal should be dismissed.
The appeal in this instant case being groundless, it is dismissed pursuant to Articles 449(1), 78, 463, 385(1) of the Code of Civil Procedure.
Summarized by Hu, Ming-Hua
Supervised by Chen, Hui-Ping