China’s Haidian People’s Court of Beijing city on April 19 released the 2022 white paper on the enforcement and protection of intellectual property rights in the district, reviewing the quality of its adjudication of unfair competition litigation over novel digital assets of the most recent three years. As a routine highlight, a list of top ten exemplary cases of this kind was compiled and released.
Case 01
Baidu Netcom Science and Technology (Beijing) Co., Ltd. (北京百度网讯科技有限公司), China’s search engine giant Baidu, Inc.’s subsidiary, sued Suzhou Mengxiyou Network Technology Co., Ltd. (苏州梦西游网络科技有限公司), a third-party online store on China’s biggest e-commerce platform Tmall.com, for developing a plug-in to Baidu Netcom’s document-sharing service without authorization and offering it to Suzhou Mengxiyou’s own customers for bargain prices. Baidu Library was launched in 2009 as an open online document-sharing service, where all documents are uploaded by users up for service operator Baidu Netcom’s censoring before becoming available for sharing or downloading for free or for fees without the service operator’s editorial intervention. Users can either upload documents to gain reward points to be used as downloading credit where applicable or purchase download coupons to be entitled to download some documents designated as paid offerings. With the application of the plug-in, Suzhou Mengxiyou’s customers managed to circumvent Baidu Library’s technical barriers against its operator’s will to download all paid offerings without compensation. The trial court ruled for Baidu Netcom and ordered Suzhou Mengxiyou to pay 3.03 million yuan ($470,000) in damages and costs. The defendant appealed the case and the appellate court upheld the lower court ruling. This is China’s first lawsuit over the unauthorized enabling of the download of paid offerings of an online document-sharing service.
Related legal rule(s):
Article 2 Paragraph 4 of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.: （2019）京0108民终51116号
Case docket no. English transliteration is 51116, first instance (初), civil case (民), (2019) Haidian District People’s Court of Beijing City (（2019）京0108).
Case 02
Baidu Online Network Technology (Beijing) Co., Ltd. (百度在线网络技术（北京）有限公司), China’s search engine giant Baidu, Inc.’s subsidiary, sued Beijing Zile Technology Co., Ltd. (北京子乐科技有限公司), a rival smart speaker maker, for infringing its branded voice command. Baidu launched its first smart speaker product Xiaodu Zaijia X8 in 2018 and Xiaodu Zaijia has been China’s best-selling smart speaker. This type of loudspeaker and voice command device has an integrated virtual assistant that offers interactive actions and hands-free activation with the help of one “hot word.” Xiaodu Zaijia’s hot word is “Xiaodu, Xiaodu,” which had become as well recognized as a byword for smart speakers in China. Beijing Zile developed and manufactured an AI-based children’s educational device called Du Yaya, which was in essence a smart speaker, similar to Xiaodu Zajia in function, and adopted “Xiaodu, Xiaodu” as its hot word for activation. Beijing Jingwei Zhicheng E-Commerce Co., Ltd. (北京经纬智诚电子商务有限公司) was also named in the suit as a distributor of the infringing device. Beijing Zile articulated and accentuated the Xiaodu element in advertisement campaigns for its Du Yaya-branded learning device. Baidu Online accused Beijing Zile of attempting to create a false association between Xiaodu Zaijia and Du Yaya to deliberately mislead consumers. The court ruled for Baidu Online and ordered Beijing Zile and Jingwei Zhicheng to pay 550,000 yuan ($86,000) in damages and costs. This is China’s first lawsuit over a smart speaker’s voice command.
Related legal rule(s):
Article 6 Paragraphs 1 and 4 of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2019）京0108民初63253号
Case docket no. English transliteration is 63253, first instance (初), civil case (民), (2019) Haidian District People’s Court of Beijing City (（2019）京0108).
Case 03
Shenzhen Tencent Computer Systems Co., Ltd. (深圳市腾讯计算机系统有限公司) and Tencent Technology (Shenzhen) Co., Ltd. (腾讯科技（深圳）有限公司), two subsidiaries of Chinese multinational technology and entertainment conglomerate Tencent Holding Limited, sued Guoding Cyberspace Security Technology Co., Ltd. (国鼎网络空间安全技术有限公司), for developing a plug-in to Tencent’s multi-purpose instant messaging app WeChat without authorization and profiting from its sale. Tencent released WeChat in 2011, which became the world's largest standalone mobile app in 2018, with over 1 billion monthly active users. Tencent Computer is the app’s copyright holder and operator and Tencent Technology its copyright holder and trademark owner. X Avatar, as a plug-in developed by Guoding Cyberspace, allowed its users to enable a virtual space independent of WeChat when they opened X Avatar first and ran WeChat on X Avatar’s platform. X Avatar entitled users to six extra features such as camouflaging their original WeChat profiles, forwarding voice messages, automatically snatching red envelopes, etc., which were not provided by WeChat. WeChat has been promoting a single-identity, real-name policy as a badge of authenticity since its inception. Guoding Cyberspace tampered with WeChat’s operational “playbook” against service operator Tencent’s will and damaged its credibility with its users by conspicuously positioning X Avtar as an identity-changing tool. The court ruled for Tencent Computer and Tencent Technology and ordered Guoding Cyberspace to pay 3.15 million yuan ($490,000) in damages and costs.
Related legal rule(s):
Article 12 Paragraph 2 Item (4) of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2019）京0108民初52890号
Case docket no. English transliteration is 52890, first instance (初), civil case (民), (2019) Haidian District People’s Court of Beijing City (（2019）京0108).
Case 04
Beijing Weimeng Internet Technology Co., Ltd. (北京微梦创科网络技术有限公司), one of China’s most established internet-based companies Sina Corporation, sued Hunan Eefung Software Co., Ltd. (湖南蚁坊软件股份有限公司), a data-analysis company listed on China’s National Equities Exchange and Quotations (NEEQ), for scraping information from Sina Weibo with its proprietary system Eagtek without authorization to process and sell as intelligence to its client base, of which local and state governments were the major part. Sina Corporation launched its microblogging (weibo) service in 2009, which is one of the biggest social media platforms in China, with over 573 million monthly active users as of Q3 2021. Eefung Software utilized Eagtek to access the data publicly available on Sina Weibo as well as some confidential information whose disclosure was denied by its service operator Weimeng by circumventing technical barriers against Weimeng’s will. Weimeng claimed that Eagtek had injured the economic value of its own data-analysis product, similar to Eagtek. The court ruled for Weimeng and ordered Eefung Software to pay 5.28 million yuan ($820,000) in damages and costs. The defendant appealed the case and the appellate court upheld the lower court ruling. This is deemed China’s first lawsuit over data monopoly.
Related legal rule(s):
Article 12 Paragraph 2 Item (4) of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2018）京0108民初28643号
Case docket no. English transliteration is 28643, first instance (初), civil case (民), (2018) Haidian District People’s Court of Beijing City (（2018）京0108).
Case 05
Beijing Weimeng Internet Technology Co., Ltd. (北京微梦创科网络技术有限公司) sued Asia Innovations Internet Technology (Beijing) Co., Ltd. (云智联网络科技（北京）有限公司) for scraping information from Sina Weibo as offerings to its entertainment and celebrity fan engagement app Super Fans Club without authorization. Asia Innovation utilized automated bots to access the data publicly available on Sina Weibo, as China’s biggest source of entertainment news, as well as some confidential information whose disclosure was denied by its service operator Weimeng by circumventing technical barriers against Weimeng’s will. Weimeng claimed that Asia Innovation had damaged Sina Weibo’s economic value by diverting Sina Weibo’s traffic to its app, where users paid to access news and stories as subscription and membership content. The court ruled for Weimeng and ordered Asia Innovation to pay 10 million yuan ($1.56 million) in damages and costs. The defendant appealed the case and the appellate court upheld the lower court ruling.
Related legal rule(s):
Article 12 Paragraph 2 Item (4) of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2017）京0108民初24512号
Case docket no. English transliteration is 24512, first instance (初), civil case (民), (2018) Haidian District People’s Court of Beijing City (（2018）京0108).
Case 06
Youku Information Technology (Beijing) Co., Ltd. (优酷信息技术（北京）有限公司) sued Anhui Daofeng Network Technology Co., Ltd. (安徽省刀锋网络科技有限公司) for renting Youku member accounts in bulk on its two services. Founded in 2003, Youku is one of China's top online video and streaming service platforms. Initially positioning itself as a platform of user-generated content, Youku has switched to prioritize its paid subscription service over free content, where premium licensed content and its own productions were offered. Anhui Daofeng made the rental of Youku member accounts entitled to those premium paid offerings for bargain prices one of the major businesses on its two websites. The court ruled for Youku and ordered Anhui Daofeng to pay 1.23 million yuan ($190,000) in damages and costs. The defendant appealed the case and the appellate court upheld the lower court ruling.
Related legal rule(s):
Article 2 of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2020）京0108民初2913号
Case docket no. English transliteration is 2913, first instance (初), civil case (民), (2020) Haidian District People’s Court of Beijing City (（2020）京0108).
Case 07
Beijing iQIYI Science and Technology Co., Ltd. (北京爱奇艺科技有限公司) sued Beijing Sogou Information Service Co., Ltd. (北京搜狗信息服务有限公司) and Beijing Sogou Technology Development Co., Ltd. (北京搜狗科技发展有限公司), two subsidiaries of China search engine company Sogou, Inc., for diverting iQIYI’s traffic to Sogou’s websites. Nasdaq-listed iQIYI was launched in 2010 and is currently one of the largest online video sites in the world, with nearly 6 billion hours spent on its service each month and over 500 million monthly active users. The Sogou search engine (Sogou.com), jointly maintained by Sogou Information and Sogou Technology, ranked among China’s top search engines. iQIYI accused the two service operators of driving users away to other websites hosted by them whenever users clicked on the recommended keywords for searching available at the bottom of the iQIYI landing page after accessing iQIYI via the Sogou search engine. The court ruled for iQIYI and ordered Sogou Information and Sogou Technology to pay 2 million yuan ($310,000) in damages and costs. The defendant appealed the case and the appellate court upheld the lower court ruling.
Related legal rule(s):
Article 2 of the Anti-Unfair Competition Law of the People’s Republic of China
Article 12 Paragraph 2 Item (4) of the Anti-Unfair Competition Law of the People’s Republic of China
Article 46 Paragraph 2 of the Civil Procedure Law of the People’s Republic of China
Case docket no.:（2019）京0108民初55073号
Case docket no. English transliteration is 55073, first instance (初), civil case (民), (2019) Haidian District People’s Court of Beijing City (（2019）京0108).
Case 08
Beijing Sogou Technology Development Co., Ltd. (北京搜狗科技发展有限公司) and Beijing Sogou Information Service Co., Ltd. (北京搜狗信息服务有限公司) filed a petition with the Haidian District People’s Court of Beijing city against Beijing Kingsoft Internet Security Software Co. (北京金山安全软件有限公司), Cheetah Internet Technology Co., Ltd. (猎豹网络技术有限公司), and Cheetah Mobile, Inc. (猎豹移动公司). Petitioners Sogou Technology and Sogou Information accused the three respondents of compulsorily replacing the homepage of the Sogou search engine with a page hosted by Kingsoft listing all websites approved and recommended by Kingsoft as long as users installed Kingsoft Antivirus, an antivirus software developed by Cheetah Mobile, Inc., on their computers. The two petitioners filed for the court’s order to preserve all data that may relate to a legal action involving the parties and ensure that the data in question will be available for the discovery process prior to litigation. The court granted the preservation order and ruled two of the respondents cease the anti-competitive practice, clearing a third respondent Cheetah Mobile, Inc. of involvement in the act.
Related legal rule(s):
Article 12 Paragraph 2 Item (4) of the Anti-Unfair Competition Law of the People’s Republic of China
Case 09
Beijing Microlive Vision Technology Co., Ltd. (北京微播视界科技有限公司) filed a petition with the Haidian District People’s Court of Beijing city against Beijing Chuangrui Media Co., Ltd. (北京创锐文化传媒有限公司) and Chengdu Liao Culture Communication Co., Ltd. (成都力奥文化传播有限公司). Beijing Microlive developed and maintained video-focused social networking service Douyin, known as TikTok outside China. Petitioner Beijing Microlive accused the respondents of scraping over 50,000 short-form video works from Douyin to offer on its own app called Shua Bao (Chinese: 刷宝) with the use of manual labor and automated bots. The petitioner filed for the court’s order to preserve all data that may relate to a legal action involving the parties and ensure that the data in question will be available for the discovery process prior to litigation. The court granted the preservation order and ruled the respondents to cease the anti-competitive practice and remove all scraped content from its app.
Related legal rule(s):
Article 2 of the Anti-Unfair Competition Law of the People’s Republic of China
Case docket no.:（2019）京0108民初35902号
Case docket no. English transliteration is 35902, first instance (初), civil case (民), (2019) Haidian District People’s Court of Beijing City (（2019）京0108).
Case 10
Beijing Kingsoft Internet Security Software Co. (北京金山安全软件有限公司) and Cheetah Internet Technology Co., Ltd. (猎豹网络技术有限公司) filed a petition with the Haidian District People’s Court of Beijing city against Beijing Sogou Technology Development Co., Ltd. (北京搜狗科技发展有限公司) and Beijing Sogou Information Service Co., Ltd. (北京搜狗信息服务有限公司). Petitioners Kingsoft and Cheetah accused the two respondents of compulsorily replacing the homepage of the Cheetah browser with that of the Sogou browser as long as users installed the Cheetah browser on their computers and set it as the default browser on their computers. The two petitioners filed for the court’s order to preserve all data that may relate to a legal action involving the parties and ensure that the data in question will be available for the discovery process prior to litigation. The court granted the preservation order and ruled the respondents to cease the anti-competitive practice.
