South Korea is aiming to become one of the four intellectual property powerhouses of the world, but the South Korean government’s protection of intellectual property rights still has a far way to go. It is still frequent that a large corporation steals technology from a smaller company and a company with patent rights has to waste money and time without any substantial compensation in patent infringement lawsuits.
Multiple bills for technology stealing prevention and patent owner protection are currently pending in the National Assembly. Experts point out that those bills should be passed without delay to promote technological development by startups and foster a sound entrepreneurial ecosystem.
Punitive damages are regarded as one of the most urgent measures for patent holder protection. According to the Korean Intellectual Property Office, the average amount of damages was 78 million won (US$70,200) in domestic patent lawsuits from 2009 to 2011 whereas the average amounts to 10.2 billion won (US$9.1 million) in the United States. This is why some South Korean companies appropriate technology irrespective of the patent law.
Besides, at present, non-large companies have a very lower chance of winning against larger stealers in patent infringement lawsuits. According to Liberty Korea Party lawmaker Lee Hyun-jae, the former won only 10.1% of their lawsuits against the latter from 2009 to 2003 whereas the latter won approximately 40% of their suits against the former.
In this regard, multiple lawmakers are trying to amend the patent law in various ways. For example, according to a bill proposed in August last year by The Minjoo Party lawmaker Won Hye-young, a patent infringer has to pay a compensation equivalent to 300% of the loss of the victim. Lawmaker Hong Eui-rak from the same party proposed a bill last month to increase the compensation to 1,000%. Such bills are hardly being discussed though.
Hurdles still remain even after an agreement between the ruling and opposition parties as some civil law experts are claiming that punitive damages are against South Korea’s legal systems and philosophies. “In the legal system of South Korea, no recompense can exceed the actual amount of loss and patent law violators are to be criminally charged,” said Hannam University professor Kim Kwan-shik, adding, “Given that patent law violators face no criminal charges in the United States, punitive damages in South Korea may lead to an excessive punishment.”