China’s Supreme People’s Court Limits the Application of “Functional Features” Patent Claim Interpretation

By Hailong Sun

繁體中文

China’s IP Tribunal of Supreme People’s Court limited application of the “functional features” method of claim interpretation in an appeal of a case filed in Shanghai IP Court by foreign company Valeo Systemes D’Essuyage relating to vehicle windscreen wiper technology.  The appeal decision brings patent claim interpretation in China closer to the way that claims are construed in Europe and the United States.  As a result of the decision, the Shanghai IP Court has awarded RMB 7 million (approximately USD 1 million) in compensatory damages and expenses to Valeo.

China’s IP Tribunal of Supreme People’s Court (“the Supreme Court”) limited application of the “functional features” method of claim interpretation in an appeal of a case filed in Shanghai IP Court by foreign company Valeo Systemes D’Essuyage relating to vehicle windscreen wiper technology.  The appeal decision brings patent claim interpretation in China closer to the way that claims are construed in Europe and the United States.

In Valeo Systemes D’Essuyage vs. Lukasi Car Accessories (Xiamen) Co. Ltd. and Fuke Car Accessories (Xiamen) Co. Ltd. et al. (“the Valeo case”), the Supreme Court dealt with application of claim interpretation rules for a “functional feature.”  A functional feature in China is interpreted in a manner similar to that of a means-plus-function claim limitation in the United States.  According to the existing rules of patent claim interpretation according to the Supreme Court, a functional feature should be interpreted as the technical feature described and shown in the description and drawings that is essential to achieve the claimed function or its effect.  That is, a functional feature will not be construed in accordance with its broadest reasonable scope in terms of its function alone.  Further, under this rule, some unnecessary limitation in the description or drawings may sometimes be read into the claimed feature even though the rule should permit only “essential” features to be included in the scope of the element.  Thus, the patentee may be disappointed if a claimed technical feature is determined by the trial court to be a functional feature.

The “functional feature” interpretation rule is explained in the Interpretation on Several Issues Concerning the Application of Law in the Trial of Patent Infringement Cases (II) of the Supreme Court as follows:

“A functional feature is a technical feature defining the structure, composition, step, condition or their relations by its function or effect in the relevant invention-creation, unless a person of ordinary skill in the art is able to directly and clearly determine the specific embodiment for achieving such function or effect by reading only the claim.”

When a technical feature is functionally described in a claim, the condition for determining the technical feature as a non-functional feature is very strict. That is, unless a specific implementation can be determined by person of ordinary skill in the art: i) directly and clearly, and (ii), only with reference to the claim language, a technical feature will be considered to be a functional feature.  Therefore, in practice, many technical features are considered as functional features.  This has the effect of limiting claim scope in the same manner as the means-plus-function claim format in U.S. patent law is understood to limit claim scope.

In the Valeo case, the asserted claim states that “in the closed position, the safety buckle extends facing the locking element for preventing elastic deformation of the locking element and locking the connector.”  Here, “preventing the elastic deformation of the locking element and locking the connector” is obviously a functional description.  The Shanghai IP Court in the first instance held that “this feature discloses only the direction and positional relationship between the safety buckle and the locking element, and this relationship is not sufficient to prevent the elastic deformation of the locking element. An ordinary skilled person in the art cannot directly and clearly determine specific implementation for ‘preventing the elastic deformation of the locking element and locking the connector’ only by reading the claims.”  Thus, this feature was determined to be a functional feature.

However, the Supreme Court reversed the trial court’s decision.  The Supreme Court ruled that “if a technical feature has defined or implied the specific structure, components, steps, conditions of the inventive technical solution or the relationship between them, even if the technical feature also limits the functions it performs or the effect, in principle, it is not a functional feature.”  The Supreme Court reasoned that “the above technical features actually define the orientation relationship between the safety buckle and the locking element and imply a specific structure ‘the safety buckle extends facing the locking element.’  The effect is to ‘prevent the elastic deformation of the locking element and lock the connector.’  According to this orientation and structural relationship, in view of the patent specification and drawings, it can be understood by those skilled in the art that when the distance between the extending portion and the outer surface of the locking element is sufficiently small, the feature ‘the safety buckle extends facing the locking element’ can solve the technical problem.”

The Supreme Court finally concluded that “the characteristic of this technical feature is that it not only defines the specific orientation and structure, but also defines the function of the orientation and structure, and the specific content of the orientation and structure can be clearly determined only by combining the orientation and structure with the function they provide.  Although the technical feature of this ‘orientation or structure + functional description’ has a description of the function, it is still an orientation or a structural feature instead of a functional feature.”  The result of this is that the claim is entitled to broader scope than if it had been determined to be a functional feature.

In the Valeo case, the Supreme Court seems to have limited the application of the claim interpretation rules for functional features.  If a technical feature includes or implies structural features, the Supreme Court may interpret it by reading, or in view of, the description and drawings rather than by “reading only the claim.”  Further, it may not be necessary that the specific content of the structural features be determined “directly and clearly” from the claim language itself.  This may also be implied and clarified by reading the description and drawings.

Even though the Shanghai IP Court made errors in its analysis, infringement was found under the Doctrine of Equivalents, so the judgment of the trial court was actually upheld.  Upon return of the case to the trial court, the Shanghai IP Court most recently awarded compensatory damages to Valeo in the amount of RMB 6 million, plus an additional RMB 1 million for expenses.  The Valeo case has been listed as China Guiding Case No. 115 and will have a far-reaching impact on patent infringement litigation in China.