SI Group is Ordered by Court Final Judgment to Compensate Sino Legend with RMB One Million Yuan for Illegal Conducts Constituting Commercial Defamation

USA - English

• USA - English

ZHANGJIAGANG, China, Oct. 18, 2016 /PRNewswire/ -- The Intermediate People's Court of Suzhou City recently made final verdict on the commercial defamation dispute between the Plaintiff Sino Legend (China) Chemical Co., Ltd. (hereinafter referred to as "Sino Legend") and the Defendant SI Group (Shanghai) Co., Ltd. (hereinafter referred to as "SI Group"). The court rejected the appeal of SI Group, maintained the first instance judgment which is that SI Group has the intentional malicious behavior of weakening the opponent's competitiveness through defamation, and ordered SI Group to stop infringement, eliminate effects and compensate for losses.

The litigious dispute between Sino Legend and SI Group can be traced back to year 2008.

In November 2008, SI Group reported to Economic Crime Investigation Corps of Shanghai Municipal Public Security Bureau, alleging that Sino Legend stole their business secrets. On September 4, 2009, the Economic Crime Investigation Corps of Shanghai Municipal Public Security Bureau decided not to register the case, because an investigation found that Sino Legend committed no crimes.

In February 2010, SI Group initiated dispute litigation to Shanghai No. 2 Intermediate People's Court over patent application right and infringement on commercial secrets, alleging that Sino Legend infringed commercial secrets of SI Group. Shanghai No. 2 Intermediate People's Court made judgment on June 17, 2013, determining that the technology of Sino Legend was an independent research and development result achieved by Sino Legend, and that all litigious appeals of SI Group were groundless in respect of fact and law, and therefore the court did not support the appeals. On October 12, 2013, Shanghai High People's Court made the final verdict, rejecting appeals of SI Group and maintaining the original judgment, as the appeals were groundless in respect of fact and law. Furthermore, the verdict strongly criticized SI Group for withdrawing lawsuit yet again right before court trials, asserting "the appellant applied for case withdrawal at this time not for the purpose of case dropping, but for buying time for advocating another litigation, which was obviously against the principle of integrity." In December 2015, Shanghai High People's Court again rejected the retrial application of SI Group, and pointed out in harsh rhetoric "As a party to the case with relatively strong capacity of action and professional lawyers, SI Group ignored explicit regulations in Chinese laws, and failed to duly exercise litigation rights and perform litigation obligations during case trial. In addition, during case trial by second instance court and retrial inspection by this court, SI Group repeatedly raised procedural objections which obviously lacked factual and legal support. The conducts of SI Group were against the basic litigious principle of integrity, and this court decided not to support the appeals and to give reprimand."

In February 2010, SI Group sent letters to tire factories in Japan and the three largest tire factories of the world, alleging that Sino Legend infringed its commercial secrets. The allegations were made before Shanghai No. 2 Intermediate People's Court made judgment on the case. Competent authorities have confirmed the above mentioned conducts of SI Group. In order to protect its own lawful rights and interests, Sino Legend filed commercial defamation case against SI Group to the People's Court of Zhangjiagang City.

In May 2015, the People's Court of Zhangjiagang City made judgment in favor of Sino Legend over the commercial defamation case, requesting SI Group to immediately stop all commercial defamation and to deliver open letters to clear the facts to Michelin (China) Investment Co., Ltd., Sumitomo Rubber Industry Group, Toyo Tires Co., Ltd., Goodyear Tires Management (Shanghai) Co., Ltd., The Yokohama Rubber Co., Ltd., and Continental Tire Trading (Shanghai) Co., Ltd. Moreover, SI Group has to publish the open letter on its website, on the journals Tire Industry and China Rubber Industry, and to compensate Sino Legend with RMB1,000,000 for economic losses. In September 2016, the Intermediate People's Court of Suzhou City again determined that SI Group has the intentional malicious behavior of inappropriate competition and of causing actual losses, and therefore, the court rejected the appeals of SI Group and maintained the original judgment.

Lawyer Liu Feng, director of Intellectual Property Commission of Shanghai Bar Association and senior partner with Beijing Dentons (Shanghai) Law Office, remarks, "Adequate infringement warning letter should inform the opponent party of the rights of the letter issuing party, and scope of the right, and the letter should facilitate dispute settlement through negotiation. However, as we can see in this case, SI Group quoted partial information which was in favor of itself and sent the misleading accusations against Sino Legend to clients of Sino Legend, despite the fact that the preliminary authentication report obtained by SI Group had been rejected by competent judicial authorities. Therefore, SI Group was intentional in commercial defamation." "From the early half of 2010 until today, the Plaintiff Sino Legend had spent more than six and a half years going through first instance and second instance trials, and finally earned justice it had been seeking for a long time. This case provided excellent inspiration to Chinese enterprises. In recent years, with the continual progress in technology levels of Chinese enterprises, previous leading enterprises begin to feel uncomfortable, doubtful, and they even use various means to prevent the progress. Chinese enterprises are facing the challenges of how to correctly and effectively settle malicious commercial defamation and malicious prevention."

"Sino Legend has always been advocating the essential characters of integrity and honesty as the foundation of man and the lifeline of enterprise," remarks Corey Xie, general manager of Sino Legend. "Unfortunately, there are still enterprises such as SI Group who knows only interests, ignores facts and robs orders by maliciously defaming competitors. The market must impose boycott on such enterprises so as to create a market where fair competition and healthy development prevail."

Law affairs director of Sino Legend commends, "The verdict given by the Intermediate People's Court of Suzhou City is sufficiently presented and is supported by strong evidences. The verdict keeps Sino Legend's reputation from damage by affirmation of the first instance court that the Open Letter sent by SI Group distorts facts, and that SI Group has the intentional malicious behavior of inappropriate competition and of causing actual losses to Sino Legend." "Sino Legend will seek lawful remedies against any infringements violating Sino Legend's commercial secrets and damaging Sino Legend's commercial reputation. Sino Legend shows its resolve in protecting its own rights and interests through the case of commercial secrets infringement against SI Group. Verdict on the case has been given by Shanghai No. 2 Intermediate People's Court at the end of April this year, determining that SI Group has indeed acquired technical secrets of Sino Legend, and prohibiting SI Group to disclose and use the technical information in the future."

For more information about Sino Legend, please visit our company website www.SinoLegend.com.

SOURCE Sino Legend (China) Chemical Company Ltd.

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http://www.SinoLegend.com