Patents in Asia 2018/2019: South Korea
Top legal experts in South Korea provide an exclusive insight into the country’s patent prosecution and litigation strategy for 2018
How do you get a patent in your jurisdiction?
Types of protection and eligibility criteria
Patentable subject matter includes:
- processes; and
- material inventions.
The Patent Act does not provide any statutory exceptions to patentable subject matter. Instead, the Korean Intellectual Property Office (KIPO) Examination Guidelines provide examples of non-patentable subject matter, including:
- laws of nature;
- discoveries of laws of nature or natural phenomena;
- ideas contrary to the laws of nature (eg, a perpetual motion machine);
- personal skills obtainable by practice (eg, the method for playing a musical instrument);
- mere presentation of information;
- aesthetic creations; and
- computer programming language or computer programs.
The major criteria for patentability in Korea are:
industrial applicability – the invention must be feasible and useful;
- novelty and inventive step – the invention must be novel and not easily conceived by a person with ordinary skill in the art;
- first to file – when two or more patent applications relating to the same invention are filed on different dates, only the application with the earliest filing date is patentable; and
- unity of invention – an application may include only one invention or a group of inventions that share a common inventive feature.
The application – process and costs
An applicant may file a Korean patent or utility model application by filing:
- an application in Korea;
- an international application under the Patent Cooperation Treaty and subsequently entering into the Korean national phase within 31 months from the priority date; or
- a foreign application and then claiming priority through the Paris Convention within one year of the foreign filing date.
Substantive examination begins after a request for examination is filed (up to three years after the filing date for applications filed on or after 17 March 2017 or up to five years for applications filed before 17 March 2017). The examination decision is typically issued within 10 to 13 months of the request for examination.
The total prosecution cost may vary significantly, depending on:
- the complexity of the case;
- the number of office actions issued; and
- whether the application is appealed.
Costs can range from several thousands to tens of thousands of dollars.
Technology-based considerations (eg, software and pharmaceuticals)
Some subject matter is not patentable under current KIPO practice, including:
- software and business methods covering only abstract ideas or mental steps;
- methods for the medical treatment of humans, including surgical, therapeutic and diagnostic methods; and
- inventions that are contrary to public order, morality or public health.
For a software or business method invention to be granted, two requirements must be met. First, information processing by software should be realised concretely through the use of hardware (eg, claims should describe the involvement of concrete hardware-type components that account for information processing and interaction between them). Second, claims should involve no human activities (as opposed to software processing).
Software and business method inventions can be claimed in the form of:
- a method;
- an apparatus;
- a computer-readable medium (storing a computer program); or
- a computer program (stored on a medium).
By contrast, claims directed to software, a computer program per se (not stored on a medium) or a program product are not allowed.
What are the major administrative procedures in your jurisdiction?
Appealing patent office decisions
If an application is rejected by KIPO, the applicant may appeal to the Intellectual Property Trial and Appeal Board (IPTAB) – an administrative review body in KIPO – within 30 days.
Before filing an appeal, the applicant may amend the application and apply for re-examination within 30 days from receipt of the final rejection decision, in which case the KIPO examiner will re-examine the amended claims. If the examiner finds that the previous rejection grounds have not been overcome despite the amendments, they will issue a second final rejection, at which point the applicant may file an appeal before the IPTAB.
IPTAB decisions may be appealed to the Patent Court and then the Supreme Court.
Third-party challenges – oppositions and invalidations
A granted patent can be nullified through an invalidation action filed before the IPTAB. Patent cancellation action is also available for patents registered on or after 17 March 2017.
The invalidation action is an inter partes proceeding and only an interested party or examiner can file an invalidation action after the patent is registered. The IPTAB typically takes between six and 14 months to render a decision in an invalidation action. Such actions can also be expedited under certain circumstances (eg, where an infringement action based on the same patent is pending before a court). The losing party may appeal the IPTAB decision to the Patent Court and then the Supreme Court.
An ex parte patent cancellation action may also be filed against patents registered on or after 17 March 2017. Any party (not limited to an interested party) can file a cancellation action within six months from the registration publication date. Unlike invalidation actions, the IPTAB will determine whether to institute the proceedings. Grounds for cancellation are limited to prior art invalidity grounds based on written publications. The patentee can appeal the IPTAB cancellation decision to the Patent Court and then the Supreme Court. If the IPTAB upholds the patent, the petitioner cannot appeal the decision.
Administrative enforcement options
A patentee or alleged infringer may file a scope confirmation action at the IPTAB. This is an action seeking a determination of whether a particular product or process falls within the claim scope of a patent. A scope confirmation order may be appealed to the Patent Court and then the Supreme Court. Although such orders are not binding on subsequent infringement actions, they can have a persuasive effect on the court.
How are patents enforced through the courts?
Key forums and their composition
Patent infringement actions must be filed at one of five specific district courts: Seoul Central, Daejeon, Daegu, Busan or Gwangju. Plaintiffs may choose to bring an action at whichever of the five district courts meets the relevant venue requirements. Alternatively, they may choose to bring an infringement claim at the Seoul Central District Court due to its specialised expertise in patent infringement matters. The Seoul Central District Court has three panels of IP-specialised judges and the most expertise in IP matters among the district courts. It has several technical advisers with at least 15 years of experience as KIPO patent or trial examiners, who provide technical assistance to the judges.
All patent infringement cases are heard by judges. No juries are used to hear civil patent infringement cases.
To facilitate Korea’s increasing global presence as a hub for IP disputes, the International Court Panel was created on 13 June 2018 in both the Seoul Central District Court and the Patent Court. The panel will review the same types of IP case that both courts ordinarily review, but the parties will be able to submit briefs in English (without a Korean translation) and present oral arguments in English at hearings. The panel will also provide simultaneous interpretation at hearings and will issue decisions in both Korean and English.
Trial flow – discovery, trial, witnesses, timing and cost
Court proceedings begin with a complaint, typically followed by an initial exchange of written submissions. The court hearing procedure then begins. After a series of initial hearings, the court may ask the parties to give technical presentations and to provide witness testimony. Throughout the proceedings, the parties may submit briefs on topics of their choice; typically, both sides file briefs shortly before each hearing. When the court has determined that all issues have been raised and dealt with in the hearings and briefs, it will close the proceedings and set a date for its decision. A decision is usually issued within several weeks of the proceedings closing. Typically, it takes about 12 to 18 months for a district court to issue a decision.
Compared to the United States, broad discovery is not available and the courts directly supervise discovery. Any discovery requests must be specifically identified before a court will consider granting them. A party may request the production of documents, samples or witness testimony, or may request that the court conduct an inspection of the other party’s facilities over the course of the proceedings. However, the requested discovery must generally be identified with sufficient specificity for the court to grant the request.
The cost of a district court patent infringement case can vary widely depending on various factors, including:
- whether damages are sought;
- the degree of expert testimony required to review the relevant infringement issues; and
- the aggressiveness of the parties.
Typically, the cost will range from $150,000 to $400,000 to reach a first-instance decision. The cost of an appeal to either the High Court or the Patent Court can be slightly lower than the cost of the related first-instance case. However, cases on appeal are essentially reviewed de novo, meaning that new evidence and arguments can be introduced at the appeal stage and no deference is required to the factual findings of the first-instance court. Therefore, some significant issues can be litigated for the first time on appeal.
Legal doctrines, available remedies and the appeals process
Legal doctrines: In dealing with infringement and validity issues, legal doctrines are generally recognised in Korea, including the doctrine of equivalents and the doctrine of prosecution history estoppel.
Under the doctrine of equivalents, even if one or more elements of a patent claim are substituted with unclaimed elements in a product or process, infringement may be found if any of the following requirements are met:
- The disputed product or process uses the same principle to solve the same problems as the patented invention.
- The equivalent element in the disputed product or process achieves substantially the same effect as the claimed element.
- The equivalent element is easily conceivable to a person of ordinary skill in the relevant art.
- The disputed product or process is not anticipated or obvious in view of the prior art.
- The equivalent element was not intentionally excluded from the patent claims during prosecution.
The doctrine of prosecution history estoppel prohibits the patentee from enforcing its claims against a product or process with equivalent features if those features are deemed to have been intentionally excluded during the prosecution history. Prosecution history estoppel may apply to amendments or statements made by the applicant during prosecution.
Available remedies: In a civil action, the typical remedies are injunctive relief (preliminary or permanent) and monetary damages. If the court finds that the patent in suit is valid and has been infringed, it will grant a permanent injunction, unless in exceptional instances (eg, when seeking an injunction is deemed to be an abuse of rights). If there is a pressing risk of irreparable harm to the patentee, the patentee may bring a preliminary injunction action. To obtain a preliminary injunction, the patentee must demonstrate the likelihood of success on the merits (infringement and patent validity) and the need for provisional relief.
Damages are calculated based on:
- multiplication of the number of infringing articles by the amount of profit per unit that the plaintiff could have earned but for the infringement;
- presumption of the profits earned by the infringer; or
- reasonable royalties (as would usually be charged for a licence covering the same kind of technology).
If the facts make it difficult to compute the damages based on any of these methods, the court may determine the damages at its own discretion, taking into consideration the parties’ arguments and evidence. Korea does not recognise punitive damages for patent cases.
Appeal process: District court patent infringement main action decisions can be appealed to the Patent Court. Patent infringement preliminary injunction actions can be appealed to the district court and then the High Court. Patent Court and High Court decisions can be appealed to the Supreme Court.
How are patents commercialised in your jurisdiction?
Patent working requirements and pharma-specific rules
If a patented invention is practised for public interest, a non-exclusive licence may be granted to a third party by an administrative disposition or a trial decision instituted before the IPTAB, irrespective of the patentee’s opinion.
If a patented invention is not practised in Korea, a compulsory licence may be granted. A patented invention is considered not to have been practised in Korea in the following cases:
- The patented invention has not been worked for three or more consecutive years in Korea, except in the case of:
- natural disaster;
- unavoidable circumstances; or
- other justifiable reasons.
- The patented invention has not been worked on a substantially commercial scale in Korea for three or more consecutive years without justifiable reasons or where the domestic demand for the patented invention has not been satisfied to an appropriate extent and under reasonable conditions.
Prior consultation with the patentee or exclusive licensee is required before filing a compulsory licence petition. However, prior consultation is not required when the patented invention will be non-commercially worked for the public interest or when the working of the patented invention is necessary to remedy a practice determined to be anti-competitive by judicial or administrative proceedings. Further, a compulsory licence may be granted when the working of the patented invention is necessary for the export of medicine under the World Trade Organisation Doha Declaration to a country that intends to import the medicine in order to treat diseases that threaten the health of most of its citizens. These medicines include:
- patented medicines;
- medicines manufactured by patented manufacturing methods;
- patented active ingredients necessary for producing medicines; and
- patented diagnostic kits necessary for using medicines.
Laws and rules applicable to licensing (including FRAND)
The Monopoly Regulation and the Fair Trade Law do not apply to the fair exercise of IP rights but may be applied to the unfair exercise of IP rights. To regulate the unfair exercise of IP rights, in 2000 the Korean Fair Trade Commission (KFTC) established the Review Guidelines on Unfair Exercise of Intellectual Property Rights, which have been revised over the years. The current guidelines (effective March 2016) provide the criteria for assessing whether IP rights have been unfairly exercised with regard to the following activities:
- acquiring patent rights;
- exercising patent rights by filing suits;
- licensing, including:
- the cost for the grant of a licence;
- refusal to license;
- limitations on the scope of licensing; and
- the imposition of conditions when granting a licence;
- patent pool and cross-licensing;
- exercising patent rights relating to technology standards;
- making settlements in the process of patent disputes; and
- exercising patent rights by NPEs.
With regard to the exercising of patent rights relating to technology standards (ie, SEPs), the KFTC guidelines state that the disclosure of patent information and prior consultation on the conditions for licensing is crucial for preventing the abuse of technology designated as a technical standard. Whether these procedures have been followed is a key factor in determining the fairness of the exercise of patent rights relating to technical standards. The guidelines also state that ill use of the standardisation procedure or demanding unfair conditions after being designated as a technical standard can be deemed an unfair exercise of patent rights.
Inventor remuneration issues
In Korea, the right to an invention inherently belongs to the employee who created it. Employees have the right to receive reasonable compensation in return for the assignment of their in-service inventions to an employer. Most commentators hold that the employee’s right to reasonable compensation cannot be waived by contract.
Although there is no set formula, the Korean Invention Promotion Act provides procedures for establishing the reasonableness of the employee’s compensation. The act sets forth the procedural requirements for an employer to adopt or amend an invention compensation policy in consultation with the employee group. Further, payment of compensation in accordance with the compensation policy will be given deference as being reasonable. In order for the compensation to be deemed reasonable, it must take into account the profits that the employer has gained or expects to gain from the invention (eg, from its exploitation of the invention or from transferring or licensing the invention to third parties), as well as the relative contribution rate of the employee (compared to the employer or other employees) in completing the invention (see Article 15(6) of the Korean Invention Promotion Act).
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