(By Wang Ting and You Yunting)The limited liability of the shareholders means that the liability of the shareholder to the company are limited to its capital contribution, and the independent personality of corporation means that the Company shall fulfill its external liabilities by all of its properties. Therefore, the shareholders usually do not take personal responsibility in IPR infringement cases even when the long-term business of the company is infringement of the intellectual property rights (“IPR”) in most cases. However, today we will introduce a recent case, in which the shareholders were determined to take such joint liabilities for the IPR infringements.
Danone established a joint venture company with the Wahaha Group in 1996, with a 51 percent ownership stake of stock in the company. In addition to this joint venture company, the Wahaha Group also operated several separate non-Wahaha joint ventures. In 2007, Danone attempted to offer four billion Yuan to purchase 51 percent of the shares of all non-Wahaha joint ventures, but this offer was rejected. Subsequently, Danone was involved in a series of complex litigation against the Wahaha group in a number of jurisdictions.
(By Zhang Fan) A and B are married. After being married, the couple established a real estate company through joint investment, by which A holds eighty percent of the shares and the owns the remaining twenty percent. C and D wish to purchase all of the company’s shares, to which both A and B agree. Additionally, both participate in the preliminary negotiation with C. Afterwards, however, negotiation was only carried out between A and C, and A signed on behalf of B on the concluded Share Transfer Contract, Shareholders Decision, and the documents prepared for the change of administration. As provided in the Share Transfer Contract, A’s eighty percent share option would be transferred to C, and B’s twenty percent share option would be transferred to D. B did not sign her name on the contract. After the payment by C to A for the share transfer, both parties went to the Administration for Industry and Commerce to register the change. Now the share holding of the company is eighty percent for C and twenty for B (B never took care of the registration transferring ownership to D).
By Luo Yanjie
Recently, Shanghai Huangpu People’s Court issued white paper about cases involved Non-State-Invested Units. The white paper disclosed that the dormant investment is ubiquitous in Non-State-Invested Units during the process of their establishment, and that not only makes investors’ rights and interests unguaranteed, but also cause a serious threat to the commercial good-faith. As introduced, some actual investor would not like to establish the company in their own names considering various factors, but registered the company in others’ name. It results lots of disputes. Now we would like to discuss the risk of “dormant investment” and introduce how to reduce the risk as follows:
A three-year lasting dispute between shareholders of a property management company (the “Company”) was finally settled in recent, with the infringing shareholder judged to compensate the Company. Commencing from 15th October 2008, the case was adjudicated on 20th January 2012 at last after the arbitration of 3 years and 3 months, and with its complex plotting, the dispute could be a lesson to the shareholders of Chine enterprises.
In 2008, after years of operation, the Company has come into a stable and fast development, and its major shareholder Zhang, also the legal representative and chief director of the Company planned to introduce the strategic investment to expand the scale of the company. In June of that year, Shi, who once studied abroad and got in touch with Zhang on the beginning of the same year, purchased 23% of the company share on the approval by other shareholders, and took the post of deputy general manager in the company afterwards, which led to the separation of the Company power that Zhang took charge of the clients exploration and relationship while Shi was responsible for inner management. On 29th August, the new Legal Director appointed by Shi adjusted the Articles of the Association, and by the new regulations the supervisor has the right to dismiss the legal representative and director of the Company. And that lay the powder hose to the future conflict in the Company.
A problem in the iPad battle between Proview and Apple is noticeable that the party signing the transfer agreement with Apple is Taiwan Proview, while the iPad trademark owner is registered under the name of Shenzhen Proview, therefore, the core question emerges: could the contract signed by Taiwan Proview naturally bind Shenzhen Proview? The answer to the question concerns the personality confusion on the law. Today, Bridge IP Law commentary invites Mr. Yu Zhiyuan, the legal attorney specialized in corporate law, to introduce you the legal system on the personality confusion in China.