Prison for over 200 fraudulent Chinese patent applications yielding 900,000 RMB in government awards

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According to a news report by 知识产权界, on December 3, 2020, the People’s Court of Shehong City, Sichuan heard the corruption and bribery case of defendant Guo, and the corruption case of defendants Chen, Wu, and Wu . The court of first instance sentenced Guo to 6 years and 8 months imprisonment, fined Guo 400,000 yuan, and ordered him to refund the economic losses caused by his corruption. Guo had fraudulently filed and obtained 231 utility model patents and then applied for awards of 3,000 RMB (~$459 USD) each from Shehong County Government’s intellectual property award funds.  

The court found that Guo and others used Shehong local enterprises, farmers, technology companies and others to file utility model patents in their names. After the government awarded the 3,000 RMB to these companies or individuals, they would transfer the RMB to Guo.  The Court also found that Guo accepted bribes totaling 251,625 RMB.

Shehong, like many cities, offers awards for patent grants. Specifically, the Shehong County Authorized Patent Incentive Measures (Trial)” (Shefu Office [2011] No. 91) offered 5,000 RMB per invention patent grant, 3,000 RMB per utility model patent grant, and 1000 RMB per design patent grant. In comparison, Guangzhou currently offers up to 3,000 RMB per Chinese invention patent but no awards designs or utility models.  Note that foreign patents grants yield 20,000 RMB awards in Guangzhou.  (See 广州市知识产权工作专项资金管理办法 for more details). In contrast, Shanghai is more generous with up to 50,000 RMB/foreign patent. (See 上海市专利资助办法 for more details).

As utility model patent applications don’t get substantively examined, one could theoretically refile the same application multiple times. However, Guo presumably used multiple third parties as false applicants in order to reduce the probability that the China National Intellectual Property Administration (CNIPA) would identify the fraudulent duplicate applications.

 

Author: Aaron Wininger

Aaron Wininger is a Senior Attorney and Director of China Intellectual Property at Schwegman Lundberg & Woessner.

Author: Aaron Wininger

Aaron Wininger is a Senior Attorney and Director of China Intellectual Property at Schwegman Lundberg & Woessner.