JunHe represented Golfzon in a series of intellectual property lawsuits concerning copyright and unfair competition against imitators of their golf simulator software in various locations in China. JunHe’s team secured evidence preservation and/or behavior injunction orders in cases in Shenyang, Guangzhou and Dalian, and won favorable judgments in all the decided cases where the client’s copyright infringement and unfair competition claims were upheld.
Golfzon is a renowned South Korean enterprise specializing in the development, design and commercial application of golf simulator software and equipment and is the copyright owner of the legitimate software involved in these cases. The client discovered numerous stores in China using pirated or cracked software that severely damaged Golfzon’s and their licensees' interests. The JunHe team devised an investigation and evidence collection plan and led the investigation team in different locations. They also determined two causes of action, i.e. software copyright infringement and unfair competition by means of commercial confusion with Golfzon’s business and product name, based on infringements of the defendants in different places. JunHe initiated lawsuits against the defendants using different causes of action.
JunHe secured a favorable first-instance judgment in the Shenyang Intermediate People’s Court and a favorable final-instance judgment in the Liaoning High People’s Court in the case initiated in Shenyang. JunHe also won favorable first-instance judgments in two cases administered by the Guangzhou Intellectual Property Court which upheld the client’s claims of copyright infringement and unfair competition by means of commercial confusion. Additionally, JunHe helped the client reach settlements in two cases administered by the Dalian Intermediate People’s Court. During the trials, JunHe obtained court orders for evidence preservation from the Liaoyang Intermediate People’s Court, the Guangzhou Intellectual Property Court and the Dalian Intermediate People’s Court and secured an injunction for behavior preservation from the Liaoyang Intermediate People’s Court. In the case heard by the Shenyang Intermediate People’s Court and the Liaoning High People’s Court, the courts upheld the client’s claim for 1.5 x punitive damages and decided the highest compensation amount for software infringement in Chinese litigation history. These litigations expanded the influence of the client's rights protection actions within China and increased the maximum compensation amount for software infringement, which effectively warns third parties against piracy. In the cases tried in Dalian, the defendants were sufficiently pressured as JunHe facilitated a settlement and cooperation between the client and the defendants and realized the goal of rights protection.
The challenges and highlights of these cases include:
1. Despite the difficulty in evidence collection, preliminary evidence collection and the courts’ evidence preservation orders played a crucial role. The defendants' infringements were concealed. Unlike software that can run when installed on a computer, the concerned software runs like a game and has the attributes of a game and software. Evidence collection required capturing the screen after the software was run. Therefore, investigators had to pose as consumers and record the screen at the infringing locations, making evidence collection extremely challenging. The JunHe team devised a meticulous evidence collection plan and determined the key points for this. They also guided investigators step by step in how to complete targeted evidence collection. Based on this thorough evidence collection, JunHe provided detailed information about the infringing stores to the courts, submitted a comprehensive evidence preservation plan, and obtained court approvals for the client’s evidence preservation applications, which contributed to the client’s victories in these cases.
2. A unified litigation strategy was adopted, with adjustments on a case-by-case basis. JunHe determined two causes of action, i.e. software copyright infringement and unfair competition by means of commercial confusion with Golfzon’s product name and business name, according to the infringements of the defendants, and initiated lawsuits against different defendants using different causes of action. In some cases, JunHe successfully added actual controllers as co-defendants based on evidence they found during evidence collection. Despite the same case type, the infringement details and methods varied. JunHe tailored the approach to each case, meeting the client's expectations in rights protection. Ultimately, JunHe's copyright infringement and unfair competition claims were upheld by courts in different locations.
3. The courts awarded large compensation amounts and punitive damages. Another challenge in these cases was calculating the compensation amounts. The client did not sell software separately in China and the legitimate software was usually sold with supporting equipment, making it difficult to distinguish the price of the software and the hardware and to prove the market value of the legitimate software. In similar cases previously, the courts directly took the legitimate software’s price for import declaration as its value, which was far below its actual value. This adversely affected the price determination in these cases. JunHe submitted evidence chains to prove the standalone price of the software and explained that the legitimate software in these cases was an upgraded version of the software involved in previous cases and thus had a higher value. The Shenyang Intermediate People’s Court and the Liaoning High People’s Court adopted JunHe's arguments and recognized a relatively higher software price.
4. These cases demonstrated JunHe's integrated service advantages. Golfzon is a South Korean company, and the lawsuits were initiated in Shenyang, Dalian, Tianjin and Guangzhou. JunHe utilized the language advantages of its Korea-related practice group to maintain smooth and efficient communication with the client and mobilized resources at its Guangzhou, Dalian and Shanghai offices to achieve victories for the client.
Partners JIN, Xinghui and LIU, Jiadi led the JunHe team. Partners LIU, Jiadi, ZHANG, Xiangbin, WANG, Jiedong (Donnie) and HAN, Wenji were responsible for the specific work.