China’s Supreme People’s Court Clarifies Period for Calculating Patent Infringement Damages
Published 10 July 2026
Yu Du
On 3 July 2026, the Intellectual Property Court of the Supreme People’s Court of China (the “SPC IP Court”) published a case digest concerning an invention patent dispute over azo dyes. The SPC held that the period for calculating patent infringement damages is, in principle, governed by the patentee’s pleaded claim. Where a patentee sues on the basis of an infringement discovered before the action and claims a specified amount of damages, damages for continuing or potentially continuing conduct during the proceedings will generally not be adjudicated unless the patentee expressly brings that conduct within its damages claim before the close of oral argument at first instance.
Case History
The Patent and the Parties
The patent originated from an application filed in China on 10 March 2000 by Ciba Specialty Chemicals Holding Inc., claiming priority from a European application dated 11 March 1999. The Chinese application was published on 20 September 2000 as CN1266869A under application No. CN00106403.7, entitled “Azo Dyes and Their Preparation and Use”. It was granted on 25 August 2004 as Chinese invention patent No. ZL00106403.7.
Ownership of the patent was transferred on 1 December 2006 to Huntsman Advanced Materials (Switzerland) GmbH. The patent expired on 10 March 2020.
The three affiliated defendants were publicly identified as Zhejiang Longsheng Group Co., Ltd., Zhejiang Keyong Chemical Co., Ltd., and Shanghai Kehua Dyestuff Industry Co., Ltd. A Beijing distributor, Beijing Delvfeng Technology Co., Ltd., was also named as a defendant at first instance.
The First Infringement Action: 2007-2016
On 29 January 2007, Huntsman obtained evidence through a notarised purchase of dye products manufactured and sold by Shanghai Kehua. On 29 September 2007, it commenced infringement proceedings before the Shanghai No. 1 Intermediate People’s Court, seeking an injunction and RMB500,000 in damages.
The action was based primarily on the pre-suit notarised purchase. Huntsman did not subsequently add new infringement facts or amend its damages claim to cover conduct allegedly occurring while the proceedings were pending.
On 3 May 2013, the first-instance court found that the accused Super Black 280 and Super Black 281 products fell within the scope of the patent. It ordered Shanghai Kehua to cease the infringement and pay RMB400,000 in damages. The Shanghai High People’s Court affirmed the judgment on 15 January 2015, and the SPC rejected Shanghai Kehua’s petition for retrial on 21 December 2016.
Further Evidence and the Second Action: 2013-2019
Between July 2013 and July 2015, Huntsman conducted several further notarised evidence-preservation exercises. The evidence indicated that Zhejiang Longsheng and Shanghai Kehua had manufactured, sold or offered for sale the accused products, while Zhejiang Keyong and the Beijing distributor had participated in sales.
On 18 June 2015, Huntsman filed the present action with the Shanghai Intellectual Property Court. Because the amount in dispute exceeded RMB200 million, the case was transferred to the Shanghai High People’s Court, which accepted it on 15 September 2015. Huntsman sought an injunction, RMB230 million in economic losses and RMB1 million in reasonable enforcement expenses.
Huntsman initially claimed damages for the period from 30 September 2007, the day after the first action was filed, to 18 June 2015, the filing date of the second action. Before the close of oral argument at first instance, it requested that the end date be extended to the date of the first-instance judgment.
On 13 February 2017, the Shanghai High People’s Court appointed an accounting firm to examine sales and profits associated with the accused products. During the same proceedings, the patent was challenged in invalidation proceedings. On 7 March 2018, the Patent Reexamination Board deleted original claims 1–8 but maintained original claims 9–13 in amended form as new claims 1–5. The parties agreed that new claim 1 had the same scope as original claim 9, and Huntsman adjusted its infringement claim accordingly.
The judicial accounting review identified approximately RMB47.57 million in sales of the accused products between 4 May 2013 and 30 June 2018. Only approximately RMB279,000 was identified for the later three-year portion of that period. The accounting firm could not verify the completeness of the records because the defendants had not provided effective electronic shipment lists and other accessible electronic records.
Oral argument at first instance concluded on 30 November 2018. On 31 December 2019, the Shanghai High People’s Court ordered the defendants to cease the infringement and ordered the three affiliated companies to pay RMB14 million in economic losses and RMB300,000 in reasonable expenses.
The SPC Judgment: 2022-2024
Both Huntsman and the three affiliated defendants appealed. The SPC accepted the appeals on 28 January 2022 and held a public hearing on 11 November 2022.
On 26 January 2024, the SPC set aside the first-instance judgment and ordered the three affiliated companies jointly and severally to pay RMB19 million in economic losses and RMB500,000 in reasonable enforcement expenses. Huntsman’s remaining claims and the defendants’ appeals were dismissed.
Because the patent had expired on 10 March 2020, the operative part of the final judgment focused on monetary relief.
The SPC’s Reasoning
- The Patentee’s Pleaded Claim Defines the Temporal Scope
The SPC based its analysis on the civil-procedure principle of party disposition. The parties determine the scope of the claims to be adjudicated, and a court ordinarily may not grant relief beyond the matters placed before it.
Accordingly, a fixed damages claim based on an infringement discovered before suit does not automatically cover all similar conduct occurring while the litigation is pending. To recover damages for such conduct, the patentee must expressly or otherwise clearly bring it within the scope of the claim before the close of oral argument at first instance.
A request for an injunction does not, by itself, establish that the patentee is also seeking damages for continuing infringement. An injunction may be requested because infringement is ongoing, because there is a risk of recurrence, or simply as a precaution. It therefore cannot substitute for an express claim for litigation-period damages.
- Continuing Infringement Must Be Proved
The SPC separately considered whether infringement had been proved throughout the claimed period.
The first action established a notarised purchase on 29 January 2007, while the evidence in the second action began in 2013. Those two sets of evidence did not, without more, prove uninterrupted infringement during the intervening period of more than five years.
The SPC did not require the patentee to collect evidence at excessively short intervals. Nevertheless, some evidence corresponding to the claimed period was necessary. Periodic or irregular notarised purchases could have been conducted during the first proceedings, but no such evidence had been obtained. The Court therefore found insufficient proof of continuing infringement between 29 September 2007 and 3 May 2013.
- The Adjudicative Cut-Off Is Not an Automatic Damages Cut-Off
As a general rule, the factual cut-off for adjudication is the close of oral argument, normally at first instance. However, to avoid repeated litigation over continuing conduct, a first-instance court may, where the patentee’s claim permits, deal with infringement continuing up to the date of judgment.
This is a permissible procedural approach rather than an automatic extension of the damages period. Whether post-filing conduct is included still depends on the wording of the claim and the supporting evidence.
- The Actual Scope of the Earlier Judgment Was Decisive
The SPC also rejected the first-instance court’s assumption that the RMB400,000 awarded in the earlier action necessarily compensated infringement through 3 May 2013.
The earlier action was based on the January 2007 notarised purchase. Huntsman did not add new infringement facts or seek damages for conduct occurring during those proceedings, and the earlier judgments made no findings on the duration of infringement. The earlier award therefore could not simply be presumed to cover all conduct up to the date of judgment.
That error did not affect the ultimate result, because Huntsman had also failed to prove infringement during the disputed intervening period.
- Damages and Obstruction of Evidence
The SPC characterised the RMB14 million awarded at first instance as a profits-based award rather than statutory damages. Against audited sales of approximately RMB47.57 million, the first-instance award reflected an implied profit rate of approximately 29.43%, which fell within the relevant profit-rate range.
The SPC nevertheless considered that the award did not adequately reflect two forms of non-good-faith conduct. First, the affiliated defendants had continued the infringement despite the finding of infringement in the earlier case. Second, they had failed to provide complete financial books, electronic accounting records and the passwords required to access those records, thereby obstructing the examination of evidence.
The Court considered that this conduct was likely to have caused the accounting review to understate the scale of sales. Taking these circumstances into account, while also recognising that the defendants were not businesses operating primarily through infringement, the SPC increased economic-loss damages from RMB14 million to RMB19 million and reasonable expenses from RMB300,000 to RMB500,000.
The judgment applied an adjusted infringer-profits methodology. It did not characterise the award as punitive damages.
Comment
Although the final judgment was issued in January 2024, the SPC IP Court’s publication of the case digest on 3 July 2026 gives renewed prominence to the procedural question of how the damages period should be defined. The decision confirms that no single date automatically determines the recoverable period. The relevant period must both fall within the patentee’s pleaded claim and be supported by evidence of infringement; failure to satisfy either requirement may prevent recovery. For patentees, the practical lesson is to state the beginning and end of the damages period clearly, expressly include conduct continuing during the proceedings, make any necessary amendment before the close of oral argument at first instance, and preserve evidence at appropriate intervals.
Case History
The Patent and the Parties
The patent originated from an application filed in China on 10 March 2000 by Ciba Specialty Chemicals Holding Inc., claiming priority from a European application dated 11 March 1999. The Chinese application was published on 20 September 2000 as CN1266869A under application No. CN00106403.7, entitled “Azo Dyes and Their Preparation and Use”. It was granted on 25 August 2004 as Chinese invention patent No. ZL00106403.7.
Ownership of the patent was transferred on 1 December 2006 to Huntsman Advanced Materials (Switzerland) GmbH. The patent expired on 10 March 2020.
The three affiliated defendants were publicly identified as Zhejiang Longsheng Group Co., Ltd., Zhejiang Keyong Chemical Co., Ltd., and Shanghai Kehua Dyestuff Industry Co., Ltd. A Beijing distributor, Beijing Delvfeng Technology Co., Ltd., was also named as a defendant at first instance.
The First Infringement Action: 2007-2016
On 29 January 2007, Huntsman obtained evidence through a notarised purchase of dye products manufactured and sold by Shanghai Kehua. On 29 September 2007, it commenced infringement proceedings before the Shanghai No. 1 Intermediate People’s Court, seeking an injunction and RMB500,000 in damages.
The action was based primarily on the pre-suit notarised purchase. Huntsman did not subsequently add new infringement facts or amend its damages claim to cover conduct allegedly occurring while the proceedings were pending.
On 3 May 2013, the first-instance court found that the accused Super Black 280 and Super Black 281 products fell within the scope of the patent. It ordered Shanghai Kehua to cease the infringement and pay RMB400,000 in damages. The Shanghai High People’s Court affirmed the judgment on 15 January 2015, and the SPC rejected Shanghai Kehua’s petition for retrial on 21 December 2016.
Further Evidence and the Second Action: 2013-2019
Between July 2013 and July 2015, Huntsman conducted several further notarised evidence-preservation exercises. The evidence indicated that Zhejiang Longsheng and Shanghai Kehua had manufactured, sold or offered for sale the accused products, while Zhejiang Keyong and the Beijing distributor had participated in sales.
On 18 June 2015, Huntsman filed the present action with the Shanghai Intellectual Property Court. Because the amount in dispute exceeded RMB200 million, the case was transferred to the Shanghai High People’s Court, which accepted it on 15 September 2015. Huntsman sought an injunction, RMB230 million in economic losses and RMB1 million in reasonable enforcement expenses.
Huntsman initially claimed damages for the period from 30 September 2007, the day after the first action was filed, to 18 June 2015, the filing date of the second action. Before the close of oral argument at first instance, it requested that the end date be extended to the date of the first-instance judgment.
On 13 February 2017, the Shanghai High People’s Court appointed an accounting firm to examine sales and profits associated with the accused products. During the same proceedings, the patent was challenged in invalidation proceedings. On 7 March 2018, the Patent Reexamination Board deleted original claims 1–8 but maintained original claims 9–13 in amended form as new claims 1–5. The parties agreed that new claim 1 had the same scope as original claim 9, and Huntsman adjusted its infringement claim accordingly.
The judicial accounting review identified approximately RMB47.57 million in sales of the accused products between 4 May 2013 and 30 June 2018. Only approximately RMB279,000 was identified for the later three-year portion of that period. The accounting firm could not verify the completeness of the records because the defendants had not provided effective electronic shipment lists and other accessible electronic records.
Oral argument at first instance concluded on 30 November 2018. On 31 December 2019, the Shanghai High People’s Court ordered the defendants to cease the infringement and ordered the three affiliated companies to pay RMB14 million in economic losses and RMB300,000 in reasonable expenses.
The SPC Judgment: 2022-2024
Both Huntsman and the three affiliated defendants appealed. The SPC accepted the appeals on 28 January 2022 and held a public hearing on 11 November 2022.
On 26 January 2024, the SPC set aside the first-instance judgment and ordered the three affiliated companies jointly and severally to pay RMB19 million in economic losses and RMB500,000 in reasonable enforcement expenses. Huntsman’s remaining claims and the defendants’ appeals were dismissed.
Because the patent had expired on 10 March 2020, the operative part of the final judgment focused on monetary relief.
The SPC’s Reasoning
- The Patentee’s Pleaded Claim Defines the Temporal Scope
The SPC based its analysis on the civil-procedure principle of party disposition. The parties determine the scope of the claims to be adjudicated, and a court ordinarily may not grant relief beyond the matters placed before it.
Accordingly, a fixed damages claim based on an infringement discovered before suit does not automatically cover all similar conduct occurring while the litigation is pending. To recover damages for such conduct, the patentee must expressly or otherwise clearly bring it within the scope of the claim before the close of oral argument at first instance.
A request for an injunction does not, by itself, establish that the patentee is also seeking damages for continuing infringement. An injunction may be requested because infringement is ongoing, because there is a risk of recurrence, or simply as a precaution. It therefore cannot substitute for an express claim for litigation-period damages.
- Continuing Infringement Must Be Proved
The SPC separately considered whether infringement had been proved throughout the claimed period.
The first action established a notarised purchase on 29 January 2007, while the evidence in the second action began in 2013. Those two sets of evidence did not, without more, prove uninterrupted infringement during the intervening period of more than five years.
The SPC did not require the patentee to collect evidence at excessively short intervals. Nevertheless, some evidence corresponding to the claimed period was necessary. Periodic or irregular notarised purchases could have been conducted during the first proceedings, but no such evidence had been obtained. The Court therefore found insufficient proof of continuing infringement between 29 September 2007 and 3 May 2013.
- The Adjudicative Cut-Off Is Not an Automatic Damages Cut-Off
As a general rule, the factual cut-off for adjudication is the close of oral argument, normally at first instance. However, to avoid repeated litigation over continuing conduct, a first-instance court may, where the patentee’s claim permits, deal with infringement continuing up to the date of judgment.
This is a permissible procedural approach rather than an automatic extension of the damages period. Whether post-filing conduct is included still depends on the wording of the claim and the supporting evidence.
- The Actual Scope of the Earlier Judgment Was Decisive
The SPC also rejected the first-instance court’s assumption that the RMB400,000 awarded in the earlier action necessarily compensated infringement through 3 May 2013.
The earlier action was based on the January 2007 notarised purchase. Huntsman did not add new infringement facts or seek damages for conduct occurring during those proceedings, and the earlier judgments made no findings on the duration of infringement. The earlier award therefore could not simply be presumed to cover all conduct up to the date of judgment.
That error did not affect the ultimate result, because Huntsman had also failed to prove infringement during the disputed intervening period.
- Damages and Obstruction of Evidence
The SPC characterised the RMB14 million awarded at first instance as a profits-based award rather than statutory damages. Against audited sales of approximately RMB47.57 million, the first-instance award reflected an implied profit rate of approximately 29.43%, which fell within the relevant profit-rate range.
The SPC nevertheless considered that the award did not adequately reflect two forms of non-good-faith conduct. First, the affiliated defendants had continued the infringement despite the finding of infringement in the earlier case. Second, they had failed to provide complete financial books, electronic accounting records and the passwords required to access those records, thereby obstructing the examination of evidence.
The Court considered that this conduct was likely to have caused the accounting review to understate the scale of sales. Taking these circumstances into account, while also recognising that the defendants were not businesses operating primarily through infringement, the SPC increased economic-loss damages from RMB14 million to RMB19 million and reasonable expenses from RMB300,000 to RMB500,000.
The judgment applied an adjusted infringer-profits methodology. It did not characterise the award as punitive damages.
Comment
Although the final judgment was issued in January 2024, the SPC IP Court’s publication of the case digest on 3 July 2026 gives renewed prominence to the procedural question of how the damages period should be defined. The decision confirms that no single date automatically determines the recoverable period. The relevant period must both fall within the patentee’s pleaded claim and be supported by evidence of infringement; failure to satisfy either requirement may prevent recovery. For patentees, the practical lesson is to state the beginning and end of the damages period clearly, expressly include conduct continuing during the proceedings, make any necessary amendment before the close of oral argument at first instance, and preserve evidence at appropriate intervals.