Case on the Patent Litigation Procedure

[7-2 KCCR 264, 92Hun-Ka11 et al., September 28, 1995]

A. Background of the Case

In this case, the Court found the former Patent Act and the former Design Act nonconforming to the Constitution, whereby the first and second trials on patent disputes, which are fact-finding proceedings, were to be conducted by an administrative agency, not a judge.

The former Patent Act (prior to amendment by Act No. 4892 on January 5, 1995) provided that the first trial and appellate trial on patent disputes should be conducted by the Korean Intellectual Property Office, an administrative agency. It also provided that the rulings of the appellate trial should be appealed directly to the Supreme Court but only on the ground that they violated the laws and regulations. The former Design Act (prior to amendment by Act No. 4894 on January 5, 1995) provided that the above provisions in the former Patent Act should applymutatis mutandisto design disputes. These procedures were unique to patent and design disputes, given that other administrative proceedings were reviewed by the appellate court for a trial of fact and then by the Supreme Court for a trial of law.

In this case, during the proceedings against the Commissioner of the Korean Intellectual Property Office, the presiding courts granted the petitioners’ motions and referred the cases for constitutional review.

B. Summary of the Decision

The Constitutional Court found Article 186 Section 1 of the former Patent Act and Article 75 of the former Design Act, which applied the Patent Act provision mutatis mutandis, nonconforming to the Constitution. The Court, however, held that the above provisions will be applied until the day before March 1, 1998, when the new Patent Act (amended by Act No. 4892 on January 5, 1995) and the new Design Act (amended by Act No 4894 on January 5, 1995) come into effect.

"The right to trial by a judge" guaranteed by Article 27 Section 1 of the Constitution means that everyone is entitled to a trial in which a judge both finds facts and interprets and applies laws. Failing to guarantee this would constitute

an infringement of the essence of the constitutional right to a trial and is not permitted under the Constitution.

Under Article 186 Section 1 of the former Patent Act, however, a person objecting to the appellate rulings of the Korean Intellectual Property Office can appeal only to the Supreme Court for a trial of law and only on the basis that the rulings violate statutes and regulations. The decisions of the Korean Intellectual Property Office are made by administrative employees and do not satisfy the requirement of trials by judge in the Constitution. Article 186 Section 1 of the former Patent Act therefore deprived the petitioners of their opportunity to obtain judge-made findings of fact and law, violating the right to trial “by a judge,” guaranteed under the Constitution.

Further, Sections 1 and 2 of Article 101 of the Constitution vest judicial power with the judiciary. At the same time, Article 107 Section 3 of the Constitution does recognize administrative adjudication as a proceeding preliminary to a judicial proceeding. Together, they mean that all legal disputes are to be adjudicated by the Supreme Court and its inferior courts unless the Constitution says otherwise, and that all administrative adjudications are merely preliminary to the judicial proceedings at those courts. However, in this case, the appellate proceeding at the Korean Intellectual Property Office operates as a final review on the facts, violating Article 101 Section 1 and Article 107 Section 3 of the Constitution.

C. Aftermath of the Case

Before this decision was announced, the National Assembly voluntarily revised the relevant provisions of those statutes to conform to the Constitution. On July 27, 1994, the National Assembly revised the Court Organization Act by Act No. 4765 and thereby created the Patent Court, which became the first trial court for patent disputes. On January 5, 1995, the National Assembly also revised the former Patent Act by Act No. 4892, replacing the double-tier administrative process at the Board of Hearing of the Korean Intellectual Property Office and its Board of Appeals with a one-step process at the new consolidated Intellectual Property Tribunal. Under the new law, the Patent Court had exclusive jurisdiction over appeals from the Intellectual Property Tribunal. In addition, the reference provisions of the Trademark Act, the Design Act, and the Utility Model Act were revised accordingly. However, because the National Assembly arranged for the new laws to come into effect on March 1, 1998, the Constitutional Court

permitted provisional application of the invalid provisions until that date, by issuing a decision of nonconformity.