How does Microsoft Settle its Problems of Software Copyright Infringement in China?


 (By You Yunting) With the serious intellectual property rights infringement in China, many foreign enterprises find it difficult to protect their rights. In today’s post, we will introduce a case detailing how Microsoft settles its problems of software copyright infringement in China.

Introduction to the Case:

Plaintiff: Microsoft

Defendant: Sailun Co., Ltd (SHA: 601058)

Court of first instance: Qingdao Intermediate People’s Court

No.: (2013)青知民初字第80号, (2013)青知民初字第81号, (2013)青知民初字第82号


Questions and Solutions to Enforcement of Rights Protection by Overseas Software Enterprise in China

(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.


How to Divide the Burden of Proof in Software Infringement Cases in China?

(By Luo Yanjie) Abstract: In software infringement lawsuits, the plaintiff shall demonstrate itself as the rights holder of the software involved and the “substantial similarity” of the defendant’s software with its own. On the opposite side of the coin, once a defendant counters by claiming that no infringements have been made, it shall present relevant evidence; otherwise, it shall bear any disadvantages resulting from the failure to present proof of a lack of infringement. As for the case described in this essay, although it involves open source software, no definitive solution has yet been made to solve this particular legal program, to our disappointment.


Does Wind’s Sale of Tonghuashun’s Stock Constitute Insider Trading?


Previously, we posted “Tonghuashun VS. Wind and the Judgment Standards for Software Copyright Infringement in China” to introduce the copyright dispute between Wind and Tonghuashun. According to a recent report, two lawyers based in Beijing filed a complaint to the China Security Regulatory Commission (“CSRC”) accusing Wind and its affiliated company of insider trading, which has made the dispute more complicated.

As shown by the currently available information, from the second quarter of 2011 to the third quarter of 2012, Wind’s affiliated company was a shareholder of Tonghuashun. When the rumor emerged that Wind would sue Tonghuashun, Tonghuashun’s shares experienced several major trades. As indicated in the report issued in the third quarter of 2012, Wind sold all the Tonghuashun shares it had held. Wind explained this situation by stating that its investment in Tonghuanshun was to use its rights as a shareholder to persuade Tonghuashun to cease infringement. Today’s post will provide analysis on this issue.


Tonghuashun VS. Wind and the Judgment Standards for Software Copyright Infringement in China

(By Luo Yanjie) Recently, Wind Information Co., Ltd (“Wind Info”), a well-known stock speculation software developer in mainland China, made an official announcement that it would sue its competitor Zhejiang Hexin Tonghuashun (300033) to seek RMB 99.22 million yuan in compensation. According to Wind’s spokesman, “more than ninety-nine percent of its software’s function has been copied by Tonghuashun without any changes, including data, organizational structure, column names, connection mode, index, function, text interpretation, parameters, interface, operation or transfer method, and etc.” At present, the ninety-nine percent figure claimed by the spokesman refers to the interface, operation, or transfer method and database. Even if this claim is true, it is still not certain that Tonghuashun has infringed because the judgment of infringement depends on comparison of the source code of both parties’ software. Today, we would like to share the following information on the protection of software copyrights: