China Environmental Project Tech Inc (CEPT) won an eight-year legal battle against FKK, a Japanese chemical engineering company for infringement of intellectual rights. The Supreme People's Court made a recent and final decision in favor of the Chinese company, ordering co-defendants, Japan's Fujikasui Engineering (FKK) and Formosa Plastics Corporation USA's wholly owned subsidiary Huayang Engineering a compensation of more than 50 million RMB in damages.
CEPT founded in Wuhan in 1994, and it was a pioneer in the technology of flue gas desulphurization (FGD) in the removal of SO2. It had successfully developed a process, which it called Natural Seawater FGD (NSW-FGD) that is very advanced for energy savings and pollution control in the world. A patent application on this new technology was later filed before State Intellectual Property Office of China (SIPO) in December, 1995, and the patent was granted in September, 1999.
Huayang Engineering, a subsidiary company of Formosa Plastics Corporation initiated a set of FGD equipment from FKK, a Japanese chemical engineering company in 1997 Fujian Province. But the wastewater produced by FKK's FGD technology contained harmful pollutants beyond the Chinese national standard. Huayang Engineering then made a request to CEPT for a feasible study of seawater desulphurization to solve this problem. After gaining the apparatus and technology from CEPT, Huayang Engineering then claimed that it had mastered the technology and the apparatus, all from FKK when upgrading its desulphurization apparatus in August 1998. There was no need for CEPT's further involvement.
CEPT later filed a lawsuit against FKK and Formosa Plastics Corporation before the Fujian Supreme People's Court in 2001.
During the court proceedings, FKK filed a request to invalidate CEPT's patent. The patent was maintained by both the Patent Reexamination Board and the Beijing Higher People’s Court.
On the basis of the valid patent, Fujian Higher People’s Court made a ruling in favor of CEPT, and the ruling was further affirmed by the Supreme People’s Court. for patent infringement.
