Amendments to the Korean Patent Act from January 1, 2015

1. An applicant may file an English specification without the Korean translation

An applicant may file a provisional application in English without the Korean translation in order to obtain a patent filing number and date in Korea. The description of an invention in English does not have to be a formal patent specification. A simple literature about an invention should be sufficient if it describe all elements of an invention clearly. Under the current law, an applicant may file a provisional application in Korean without claims. Furthermore, an applicant may file a formal application in English without the Korean translation in order to obtain a patent filing number and date in Korea. Within 14 months from the earliest priority date, an applicant must file the Korean translation and claims.

2. 32 months deadline for submitting the Korean translation for national entry of PCT application

Under the current Korean law, a PCT applicant must enter a Korean national phase of a PCT application through filing documents for entering a Korean national phase of a PCT application that includes the Korean translation of a PCT specification. However, under the new law, a PCT applicant may request a one-month extension of time for submitting the Korean translation and thus may submit the Korean translation within 32 months from the earliest priority date. But, an applicant may not extend the 31 months deadline for national entry of a PCT application in Korea.

3. An applicant may correct Korean translation errors based on an original foreign language specification

Under the current Korean law, any amendment beyond the scope of the Korean translation filed shall be regarded as new matter even though the amendment has been based in the original specification in foreign language. Accordingly it is critical once there is any translational error in the Korean translation. The revised new law allows that an applicant may correct any translational errors based on the original foreign language specification and the PCT specification in foreign language.

Criminal Sanctions on Trade Secret Infringements in Korea

Trade secret Infringers may be prosecuted as criminals in addition to civil litigations. The Korean UCPA stipulates that anyone who illegally acquires trade secret of others or uses or discloses to a third party a misappropriated trade secret may be imprisoned up to ten (10) years or fined in an amount of KRW50,000,000 (approximately US$50,000) or two (2) to ten (10) times of the monetary gains. The fine may amount to the 10 times of the value of the stolen trade secret. In Hyundai Motors case, two former engineers were punished to 3.5 years imprison and US$3 million fines respectively.

Further, the Korean Supreme Court held that the act of divulging trade secret to the competitor for the purpose of gaining economic benefit by former employees shall be punished as criminal violation of the fiduciary duty under the Criminal Code. Besides UCPA, trade secrets misappropriations may be prosecuted under the criminal code, too.

In addition to criminal sanction on individuals, companies may be punished by fine that is KRW50,000,000 (approximately US$50,000) or two (2) to ten (10) times of the value of the stolen trade secrets or monetary gains of infringers.

Trade Secret Protection in South Korea

1. What is Trade Secret under Korean law?

“Trade secret” under Article 2.2 of the UCPA of Korea means technical or business information that: (i) has not been publicly disclosed, (ii) has an independent economic value, and (iii) has been maintained as secret with substantial effort. The clause of article 2.2 of the UCPA is : "trade secret" means information, including a production method, sale method, useful technical or business information for business activity, that is not known publicly, is the subject of considerable effort to maintain its secrecy and has independent economic value.

2. What is misappropriation or infringement of trade secret under Korean law?

Article 2.3 of the UCPA further stipulates that any of the following acts shall constitute an act of trade secret misappropriation:

(i) acquisition of a trade secret through theft, deception, coercion or other improper means (hereinafter referred to as “act of improper acquisition”), use or disclosure, to a third party, of the acquired trade secret (including disclosure thereof to a third party while maintaining its secrecy);

(ii) acquisition of a trade secret, with the knowledge that an act of improper acquisition was involved with respect to the trade secret or failing to know thereof due to gross negligence, use or disclosure thereof to a third party;

(iii) use or disclosure, to a third party, of a trade secret, with the knowledge gained subsequent to its acquisition that an act of improper acquisition was involved with respect to the trade secret or failing to know thereof due to gross negligence;

(iv) use or disclosure, to a third party, of a trade secret by a person who has a fiduciary duty not to use or divulge the trade secret under a contractual relationship and the like;

(v) acquisition, use or disclosure, to a third party, of a trade secret with the knowledge that the trade secret was disclosed in violation of the fiduciary duty referred to in item (iv) above or failing to know thereof due to gross negligence; and

(vi) use or disclosure, to a third party, of an acquired trade secret with the knowledge gained subsequent to its acquisition that the trade secret was disclosed in violation of the fiduciary duty referred to in item (iv) above or failing to know thereof due to gross negligence.

We can assume that the meaning or scope of misappropriation under Korean law is almost the same as those of misappropriation under American UTSA. Namely, the key points of misappropriation under Korean law include (1) acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or (2) disclosure or use of a trade secret of another Without express or implied consent by a person who used improper means to acquire Knowledge of the trade secret; or (3) at the time of disclosure or use, knew or had reason to know that his knowledge of the trade secret was (i) derived from a person who had utilized improper means to acquire it; (ii) acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or (iii) derived from a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or (4) before a material change of his position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake.

3. Remedies for Trade Secret Misappropriation

(1) Injunctive Relief

(2) Damages
   A. Actual loss (including lost profits where applicable),
   B. Unjust enrichment, and/or
   C. Reasonable royalties.

(3) Criminal Sanctions

Physicochemical Data Addition to the Specification during Prosecution

In general, the specification for a new chemical compound should describe physicochemical data of the claimed compound to such an extent that persons skilled in the art could clearly understand, recognize and reproduce the invention without any additional specific knowledge. However, as for addition of physicochemical data during prosecution, the Patent Court has somewhat differentiated a new compound invention from a new medicinal use invention. The Patent Court held that adding physicochemical data through an amendment does not constitute new matter if examples of a process for preparing claimed chemical compounds are described in detail in the specification. In principle, Korean patent practice requires that all patent applications for novel chemical compounds include physicochemical data in its original specification so as to confirm the production of the compounds. Physicochemical data refers to element analysis data, NMR data, melting point, boiling point, refraction rate, ultraviolet or infrared spectrum, viscosity, crystal type, color or the like. In case a specification fails to contain these data, the application was rejected on the grounds of (i) being an incomplete invention or (ii) failing to meet the description requirement.

The Patent Court decision is significant in that it somewhat relaxes the strict standard applied to all chemical compound inventions that are without physicochemical data. Here is an example. A patent application for novel chemical compounds was rejected by KIPO on the ground that the specification failed to meet the description requirement for a specification. In response, the applicant filed an amendment by incorporating physicochemical data on the claimed compounds, such as structural formulae, melting points and NMR data, into the specification. KIPO rejected the amendment on the ground that the incorporated physicochemical data constituted new matter. The issue was whether the physicochemical data later incorporated into the specification were essential to the confirmation of the production of the claimed compounds, in addition to the initial disclosure in the specification. The Patent Court found that the physicochemical data were not necessary since the production of the claimed compounds was confirmed from the initial disclosure based on the following: (1) chemical names and molecular formulae of substituents for the claimed compounds described in the specification can confirm structural formulae, molecular weights and chemical formulae of the claimed compounds; (2) the description "by crystallization" confirms that the compounds produced are in a solid state; and (3) reaction conditions and processes for preparing the claimed compounds are described in detail to be easily reproduced. The Patent Court has thus held that if the production of the claimed compounds can be adequately confirmed from the initial disclosure in the specification, adding such data to the specification does not constitute new matter.

Really Strict Description Requirement on Pharmacological Effect in Korea

In principle, the pharmacological effect should be described to such an extent that persons skilled in the art could clearly understand, recognize and reproduce the invention without any additional specific knowledge in the specification for a medicinal use invention at the filing stage. It is paramount to understand that under Korean patent practice the specification for pharmaceuticals or medicinal use inventions must quantitatively describe their pharmacological effects. The Korea Supreme Court specifically held that (1) if a pharmacological mechanism by which a certain pharmacological effect is provided has been clearly known, a simple description of the pharmacological effect would suffice; however, (2) in case such a pharmacological mechanism has not been known, the specification should include quantitative experimental data or the specific development of confirmation the pharmacological effect, i.e., when specific experiments were conducted, experimental methods, experimental results or the like, so that others could also confirm such a pharmacological effect.

For example, a new pharmaceutical composition with an enhanced anti-emetic effect in which the composition comprises two known anti-emetic agents, i.e., ondansetron and dexamethasone was claimed but the specification only described in connection with the pharmacological effect of the claimed composition that “the anti-emetic properties of one anti-emetic agent (i.e., ondansetron) are enhanced by administering with the second anti-emetic agent (i.e., dexamethasone).” No quantitative data supporting the enhanced effect was included in the original specification. The application was finally rejected on the ground that the specification violated the description requirement and that the claimed invention had not been completed.

Furthermore, it is not permitted to add quantitative pharmacological data to the specification through an amendment during prosecution. For example, there was a real case that an applicant submitted a declaration which was prepared before the application filing date, describing experimental data supporting the synergistic effect of the composition during the examination and trial proceedings. In that case, KIPO and the Patent Court did not allow the applicant to add data based on the ground that the addition of experimental data is new matter to the specification. Therefore, it is required to have such data or descriptions contained within the original specification at the filing stage.

Filing a Divisional Application to Broaden Scope of Claim

Under the Korean patent law, it is not allowed to file a continuation application. Furthermore, after a notice of grant has been issued, it is not available to amend claims, and an applicant is only able to correct typo errors or to narrow claim scope. Any extension of the scope of protection by amendment after grant is not allowed.

The scope of a claim must be narrow enough to be novel and non-obvious over the prior arts. On the other hand, however, claims should be infringed by the competitor’s products, services or processes and thus the scope of claims must be broad enough to cover competitor’s product or process. Even after grant, an applicant may want to have a chance to change the scope of protection.

A divisional application can play a key role for this purpose because an applicant may prepare a new set of claims having broader scope of protection than those of original application. A divisional application can be tricky. It must be differentiated from the original application in the scope of claims. But the same specification can be used for a divisional application. And more than one divisional application can be filed based on an original application.

Substantive examination of a divisional application must be requested with fee for further prosecution. Request for the examination of divisional application may be filed within five years from a filing date of an original application.

In conclusion, therefore, through filing divisional applications, applicants can strategically obtain additional patents for broader scope of protection than those of a parent patent application; or build a patent portfolio, which means more proper and various forms of claims that can be designed to cover competitors’ products, services, or processes after monitoring them for 5 years at maximum.

Check Points & Actions Must Be Considered Before Enforcement Actions

Patented claims must be valid and infringed in theory. However such claims are not common in reality. Accordingly a patentee must check strength of his patent before enforcing his patent against accused infringers. To be a valid patent claim, it should be strong enough to sustain invalidity challenges. The scope of the claim must be narrow enough to be novel and non-obvious over the prior art. On the other hand, a claim should be infringed by the competitor’s product or process. For this purpose, the scope of a claim must be broad enough to cover competitor’s product or process. These are contradictory and it is really hard to achieve desirable balance between two opposites.

Before filing a patent infringement lawsuit, it is desirable for a patentee to check strength of each patented claim based on thorough prior art search. Usually, it is necessary to fix any errors in issued patents, protect claims from possible invalidity challenges through amending claims to be novel and non-obvious over the prior art; and further pursue claims directed to competitor’s products or process if possible.

Two ways are available to amend patented claims after granting a patent in Korea. Before a patent infringement action, a patentee may amend claims as precautionary measure through ex parte proceeding at the IPT of KIPO. Namely, the first way is an independent petition to request amendment as like re-issue request in the U.S. Actually, Korea use a different terminology of “correct” for granted patents rather than “amend” for pending application before grant. It is to differentiate from each other because two terms do not have the same meaning.

The second option to amend a patented claim is correlated with an invalidity proceeding. During invalidity proceeding, a patentee may request to amend granted claims as a defense. It is very common to file a motion to correct patents during invalidity proceeding. This is inter partes proceedings between a patentee and a challenger and consolidated in invalidity proceeding. Both parties may argue whether or not such amendment to be allowed.

A patentee may amend granted claims of a patent within the scope of original disclosure and within the scope of protection of the patent as granted. In reality, post grant corrections of claims are allowed within a very limited scope. The correction must be made to (1) narrow a claim, (2) correct typological errors, or (3) clarify ambiguous description. The correction must not broaden or alter the scope of the patent right.