(By Luo Yanjie) Abstract:In the litigation of software infringement, the most fundamental evidence is that which is used to prove that the infringed software used by the defendant is plaintiff’s. It is urgent that China strengthens its punishment of infringement so as to protect commercial order and stability.

Rhino Software Inc. (hereinafter the “RhinoSoft”) developed “Serv-U”, a widely adopted FTP server software. In recent years, RhinoSoft have been trying to enforce its rights against the unauthorized use of Serv-U in China. Our previous post Analysis on the Assumption of Liability in the Serv-U Infringement Lawsuit in China has already introduced some of our analysis on this issue. In today’s post, we will be doing a complete analysis of the problems and potential solutions of RhinoSoft’s enforcement of rights in the proceeding litigation from a practical perspective.

1. Procedural questions of the evidence for claiming rights

When judging cases regarding copyright infringement, Chinese courts mechanically apply laws requesting the plaintiff to provide a software copyright certificate. However, overseas software enterprises almost always neglect to register or don’t correctly finish registration. For such situations, in order to prevent the aforementioned problems with registration, in addition to the necessary notarization and authentication of evidence in a CD format, there is a need to do separate registration for various versions of software. Furthermore, our suggestion is that RhinoSoft should register software copyright in China. Contrary to the prevailing wisdom, software copyright registration in China is not expensive. Compared with the small costs of registration, the most important benefits would spare RhinoSoft a substantial portion of the complex legal processes such as notarization and authentication and translation that would otherwise be required. For foreign software enterprises that want to claim these rights in China, such registration is a bargain compared to the costs involved in the increased complexity and litigation.

2. Does the court adopt the evidence of infringement?

There are two methods, generally, to gather evidence of infringement:  evidence preserved by the courts and evidence gathered through investigation by the parties themselves. In practice, there is a lower possibility for the parties to apply for the courts to preserve evidence. Most right holders would adopt the second method. Based on the above reasoning, RhinoSoft could take the following steps to gather infringed evidence as Serv-U is installed in the background of a webserver. First, install or start Telnet. Second, in the command-line interface of Start Menu, input the code “telnet www.XXX.com (the defendants’ website domain) 21 (Port)” to visit the defendant’s website. Then, there will be a code “220 Serv-U FTP server v6.4 for winsock ready—” appearing on the local PC.

Such code appearing on the local PC could not provide infallible evidence that the accused website had installed Serv-U, however, it may be considered “prima facie evidence” to prove that the accused website had installed Serv-U. The defendant should, if they issued a denial that they installed the aforementioned instance of Serv-U, provide adequate evidence to the contrary. In the cases such as RhinoSoft vs Boamax Indl Co., Ltd (note: the link is in Chinese) and RhinoSoft vs CE Dongli Technology Group Co., Ltd, the court determined that, the notarization certificate of Shanghai Oriental Notary Public Office proved Boamax Indl Co., Ltd to have installed the Serv-U 6.0 on its webserver.

However, another disadvantage for RhinoSoft is that the aforementioned code cannot distinguish the difference between the trial version for 30-days free use and the full version. To avoid such a risk, RhinoSoft should do this notarization twice at an interval greater than 30 days so as to prove the defendant’s infringing behavior.

3. Problems about the amount of compensation

RhinoSoft had always claimed half a million yuan in compensation. However, according to the sale price on its website, the price of Serv-U ranged from a few thousand to tens of thousands yuan. Currently, RhinoSoft has always pursued the method of conciliation to obtain higher compensation up to 300,000 yuan, but this is not always successful. At the same time, if RhinoSoft is trying to pursue a large-scale infringement lawsuit to protect its rights, it will greatly increase the burden on the courts. Under such conditions, the courts will restrain the numbers of lawsuits through decreasing the amount of compensation given.

 Lawyer Contacts

You Yunting：86-21-52134918  youyunting@debund.com/yytbest@gmail.com

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