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Update on AMSC v. Sinovel “IP theft” lawsuits

In the latest, AMSC suffered clear defeats in 2 main jurisdictions in China, Beijing and Hainan, where both jurisdictions dismissed AMSC’s copyright complaints.

http://www.windpowermonthly.com/article/1350760/sinovel-claims-court-win-amsc

In April the Beijing Intermediate People’s Court dismissed another AMSC software copyright infringment case against Sinovel.  AMSC made an appeal in May to the Beijing Higher People’s Court, requesting a revocation of the ruling as well as court support for its previous claims in the re-trial.  Several weeks ago, Sinovel also announced that it has received a written notification from the Beijing Intermediate People’s Court informing it that AMSC had requested a change to the allegations it was making.

Beijing was the more sympathetic court for AMSC.  However, it appears that AMSC knows that its case is not going anywhere in Beijing, and is now resorting to an equivalent of “Amending the Complaint after a dismissal” to keep the lawsuit alive in Beijing.

Why?  Because a final defeat in Beijing would mean that AMSC lost its court battles in all of China, and that AMSC got thrown out of 2 Chinese courts over the copyright issue without even going to trial.  Embarrassing to say the least.

Worse yet, it would also mean that AMSC lost all bargaining power in legal settlements with Sinovel, which still has pending counter claims of damages against AMSC in China.  Which means, if Sinovel wins the counter claims, Sinovel can seize AMSC’s assets and factories in China.

If AMSC’s shareholders understand that, AMSC’s stocks would go even further down the toilet.

In the meantime, the US government’s criminal case against Sinovel is bogged down in a long fight over jurisdiction, where US government is attempting to prove that it has jurisdiction to prosecute the Chinese company, just because the Chinese company has a sales office in US (which has no assets).

Of course, I would expect AMSC and others to complain more about how the Chinese courts’ decisions are further evidence of China violating IP rights.

But I still have to repeat and point out that, under US law, AMSC’s contract that did NOT mention copyrights or software licensing IMPLIED unlimited software license to Sinovel, in the hardware (which contained the installed software) sold to Sinovel.

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A further point on my previous legal analysis of the case:  It was pointed out to me that AMSC’s encrypted software has a copyright that is different than the unencrypted software.

This is true.  One can claim different copyrights for encrypted and unencrypted software versions, as well for the source code.

However, it is also technically true that AMSC’s controller firmware decrypts itself automatically, in order to function properly.  Thus, AMSC’s software copyright license to Sinovel also covered the unencrypted version, because AMSC’s controller automatically decrypts its software during use.

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