Judicial examination of patent validity always involves intricacies, which are governed by jurisdictional laws and local precedents. The jurisprudence gets even more complicated in case of technical inventions and software systems.
The Supreme People’s Court of China decision in the Shanghai Xiaoi Robot Technology Ltd. v. Apple Computer Trading Shanghai Ltd. (2020) is a perfect example of how lengthy, laborious and subjective invalidation proceedings and infringement lawsuits can be.
In this case, the Supreme People’s Court reversed the invalidity decision of the Beijing High Court and upheld the validity judgment of the Beijing First Intermediate Court. Thus, the court rejected Apple’s attempt to invalidate Xiaoi’s “Little i Robot” patent.
Xiaoi had designed and developed a foundational chatbot and conversational artificial intelligence (AI) application called “Little i Robot”. The invention could intelligently perform some AI functions, such as, voice conversation, map query and air ticket query.
The State Intellectual Property Office (SIPA, which was the China National Intellectual Property Administration, or CNIPA’s predecessor) granted the patent in 2009 to Xiaoi’s invention.
Thereafter, in June 2012, Xiaoi filed a lawsuit against Apple for infringing the patented ‘Little i Robot’ invention with the Siri application. Apple contested the validity of the Xiaoi patent, by filing an invalidation request to the Patent Re-examination Board (PRB).
The PRB, though, upheld the validity of the Xiaoi’s invention in 2013. Apple then filed an administrative lawsuit in the Beijing First Intermediate Court challenging the decision of the PRB. The Beijing First Intermediate Court affirmed in favour of PRB.
Apple then preferred an appeal before the Beijing High Court, which reversed the decision of the Beijing First Intermediate Court. The Beijing High Court suspended Xiaoi’s infringement lawsuit too. Xiaoi then filed an appeal against the judgment of the Beijing High Court before China’s Supreme People’s Court.
The most contentious techno-legal issue concerned a “game function” feature described in Xiaoi’s patent. The question was whether that feature was ‘essential’ and had been adequately disclosed.
Apple argued, and the Beijing High Court agreed, that Xiaoi had not sufficiently disclosed how the “game server” component works in relation to the conversational chatbot— thus breaching disclosure requirements enshrined specifically Article 26.3 of the Patent Law of the People’s Republic of China.
On the other hand, Xiaoi contended that the “game function” is a non-essential technical feature and that it is not strictly an integral requirement for the core “chat” function. Hence, it reasoned that the standard of required disclosure should be lower, which the first-instance court accepted.
The Supreme People’s Court overturned the high court order and reversed the invalidation. It ruled that the ‘game function’ aspect in the ‘Little i Robot’ invention is a non-essential technical feature common with existing art; and, not a distinguishing essential technical feature. Thus, it concluded that the same is sufficiently disclosed.
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The SPC decision restored the order of the first-instance court. It ruled Xiaoi’s patent met the requirement under Article26.3 of the Chinese statute. This decision reinstated the patent's validity, paving the way for Xiaoi to resume its infringement lawsuit against Apple.
The Supreme People’s Court decision has settled the jurisprudence on disclosure requirements—for non-essential technical features that are common in prior art, the sufficiency of disclosure may be more lenient as compared with distinguishing and essential technical features.
The verdict of the Supreme People’s Court has set a significant judicial standard under China’s patent-law regime. The judgment sent a strong signal that Chinese courts and administrative bodies will enforce software patents, when they have solid technical grounding and are sufficiently disclosed. However, it is not mandatory that the specification fully and exhaustively detail every aspect of a common technical features in the invention.
Xiaoi reignited its infringement lawsuit in the Shanghai People’s High Court for seeking the stoppage of Apple’s infringing activities, including the use, import and manufacture of devices running Siri and claimed RMB 100 billion in damages.
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