System Of Damages For Patent Infringement In The U.S. And Its Reference To China

Patent system has made great contribution to productivity development and social progress ever since its generation, and is playing an increasingly important role during international trade. The United States has the most advanced intellectual property institutions in the world, and its patent system has been created for more than200years. By contrast, China established its intellectual property institutions for not a long time. There is a lot to be improved in creation, use, management and protection of intellectual property. As there are more and more trading between China and America, the cases where Chinese enterprise was sentenced to compensate huge damages happened all the time, especially in patent litigation. It is of great importance to know the rules of patent protection in the United States. On one hand, it helps Chinese enterprises enter American market successfully. On the other hand, it enables Chinese enterprises to "Know yourself as well as the enemy" and find the best strategy when getting involved in a patent litigation. Meanwhile, by analyzing the system of damages for patent infringement in the United States, we can perfect our patent system and enhance the patent protection, and that is the mean purpose of this Article.This Article introduces the system of damages for patent infringement in the United States and its reference to China with three parts. Chapter One analyses the general matters of American patent infringement damages, Including who has right to institute a proceeding, who is authorized to determine the damages, the principle of imputation for damages, and what kind of losses could get awarded. In the United States, only the patent owner has right to file a lawsuit after infringement. Most cases were heard by jury and decide the damages awarded to plaintiff, while few by judge. Strict liability exists for direct infringement, whoever make use of the invention without authorization is liable to compensate the patent owner. The scope of the losses that could be awarded covers the losses of patent owner directly caused by infringement, its interests, costs aroused by stopping the infringement and attorney fees in exceptional cases. Chapter Two examines the way of calculation of damages, which is the most nuclear and complicated problem of patent infringement. There are two types of damages in American patent infringement, compensatory damages and punitive damages, the former is the general principle. Lost Profits and Reasonable Royalty are two ways to compute compensatory damages. Punitive damages are also known as Enhanced Damages in patent law, which is decided by court with discretion. The court could increase the damages up to three times of the compensatory damages when there is willful infringement. In addition, patent marking, as a limitation to damages, affects the starting point in computing damages.Chapter Three compares patent infringement system of China with that of the United States, finds out the problems existed in Chinese patent infringement system and perfects our legislation with reference to the United States. Difference exists in many aspects of patent infringement. Considering our reality and national conditions, we need to strengthen the protection of patent right and rationalize the standard of damages. By empirical study of our patent infringement cases and drawing lessons from American legislation and judicial practice, this Article suggests introduce punitive damages to our patent system and abolish the Royalty Damages, the third way of computing damages, putting it into Statutory Damages.