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  • Writer's pictureMark Cohen, J.D., M.A.

Why Is The US Helping China Undermine Global Innovation?

By Mark Cohen, J.D., former Director of the Asia IP Project at the Berkeley Center for Law and Technology



One of the world's most consequential conflicts is completely unknown to the vast majority of Americans. Nineteen countries -- including the UK, Canada, Australia, and Japan -- are currently battling in the World Trade Organization over an issue that could dictate the future of global trade, innovation and the rule of law. Most are opposed to China's position; the Biden administration is not. It's a major unforced error, and risks aiding Beijing in its efforts to cripple innovators in rival nations around the globe. At issue are "anti-suit injunctions," court-issued legal measures that prevent a party engaged in a lawsuit in one jurisdiction from simultaneously pursuing the case elsewhere. In recent years, Chinese courts repeatedly issued anti-suit injunctions, without notice or transparency, in patent lawsuits to protect Chinese companies from foreign court cases.



These legally binding orders from Chinese courts cripple the ability of foreign innovators to be compensated, and ultimately support China's goals of global technological dominance. China is violating long-standing international norms and forcing the rest of the world to play by its own, self-serving rules. Consider recent cases accusing Chinese companies, Oppo and Xiaomi, of patent infringement. When the cases were raised in China, the courts responded by issuing anti-suit injunctions against the alleged victims of infringement, Japanese company Sharp and American company InterDigital. These orders prohibited them from seeking justice outside of China. The court threatened fines for violations.

 

These arguments miss the forest for the trees. These issues are also not outliers confined to one obscure but important area of intellectual property. As Joe Whitlock, a former senior USTR official has recently noted "[T]he USTR's trade policy is increasingly unpopular" and "raised alarms among academics; civil society think-tanks; human rights and civil rights groups; strategic, cybersecurity and national security experts; small businesses; individual enterprises; economy-wide and sectoral associations; CEOs; and some 50 business groups.


They also represent a retreat from over 30 years of bipartisan efforts to encourage China to engage in transparency and responsive enforcement of IP rights. Fortunately, other allies support the EU's position. Australia, for example, backs the EU's position that China's activities have "undermine[d]" the ability of the EU and other countries to enforce IP protections within their own jurisdictions. The White House's stance is inexplicable. China's intention is plain, and its anti-suit injunction policy has a negative global impact. China is now upping the ante by setting global royalty rates for certain high-tech patents. China must be held accountable. We must work with our allies to hold China to basic standards of transparency, due process and non-interference with the parties and courts of our own legal systems.

 

 

 

About the Author


Mark Cohen, J.D. was most recently the director of the Asia IP Project at the Berkeley Center for Law and Technology at the University of California, Berkeley. He is currently an Edison Fellow at George Mason University, and also serves as a Non-Resident Scholar at the University of California, San Diego, the National Bureau of Asian Research and the Sunwater Institute. He was also a Guest Professor at Renmin University, China. He has served as the Senior Counsel, China for the USPTO. Formerly, he was Director of International Intellectual Property Policy at Microsoft Corporation. Prior to that time, he was Of Counsel to Jones Day's Beijing office. Before then, he served as Senior Intellectual Property Attaché at the U.S. Embassy in Beijing and as Attorney-Advisor in the Office of International Relations at USPTO. In total, he has nearly 30 private, public sector, in house and academic experience on IPR issues in China.



 


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