[1] Whether an exclusive licensee of a utility model right has a duty to implement a utility model where the exclusive licensee has agreed to pay a royalty according to a certain rate of performance in the future with the owner of the utility model right (affirmative)

[2] Where an exclusive licensee permits another person to use a utility model without the consent of the owner of the utility model right, whether the owner of the utility model right may terminate the contract to establish the exclusive license on the ground of such permit

[1] Where an exclusive licensee of a utility model right agrees to pay a royalty according to a certain ratio of the future performance results with the owner of the utility model right, there is no royalty to be paid to the owner of the utility model right unless the exclusive licensee implements the utility model, and thus, it is likely to infringe on the interests of the owner of the utility model right.

[2] If an exclusive licensee allows another person to use a utility model without the consent of the owner of the utility model right and allow another person to produce the products using the utility model, it shall be an act infringing on the utility model right in violation of the provisions of the Utility Model Act, so the owner

[1] Articles 37 and 42 of the Utility Model Act, Article 100 of the Patent Act / [2] Article 42 of the Utility Model Act, Article 100 of the Patent Act

A (Attorney Park Young-chul et al., Counsel for the plaintiff-appellant)

Korea Co., Ltd. (Attorneys Cho Jong-soo et al., Counsel for the defendant-appellant)

1. The defendant will implement the procedure for cancellation cancellation on July 13, 2001 with respect to the registration for establishment of an exclusive license received C on April 30, 1998 with respect to the utility model B to the plaintiff.

2. The litigation costs shall be borne by the defendant;

The same shall apply to the order.

1. Facts of recognition;

A. On April 28, 1998, the Plaintiff concluded a contract to establish an exclusive license (hereinafter referred to as “instant contract”) with the Defendant (the trade name at the time of concluding the contract on exclusive license was Micact Korea Co., Ltd. but the trade name was changed in Micact Korea Co., Ltd. on August 4, 1998) regarding the utility model right of this case as the right holder of the utility model right listed in the separate sheet stating the name of the device as “D” (hereinafter referred to as “instant utility model right”).

B. At the time of entering into the instant contract, the Plaintiff and the Defendant agreed that the Defendant, the exclusive licensee, pay to the Plaintiff the royalty equivalent to 5% of the sales price for the exclusive contract under the instant utility model right, and transfer the royalty to the Plaintiff by the 30th day of each month, and that the Plaintiff should report the sales situation at the time of transfer to the Plaintiff at the time of transfer, and that the instant contract shall be automatically terminated when the Defendant failed to perform the above matters.

C. On April 30, 1998, the defendant completed the registration of the establishment of the exclusive license (hereinafter referred to as the "registration of the establishment of the utility model right of this case") with respect to the utility model right of this case on the ground of the contract to establish the trademark of this case.

D.However, the Defendant did not implement the instant utility model at all for more than three years from the date of the instant establishment registration to the date of the notice of termination as seen below, and did not pay the Plaintiff the royalty set forth in the instant contract only once.

E. On July 13, 2001, the Plaintiff notified the Defendant that the instant contract should be terminated by content-certified mail on the grounds of the Defendant’s nonperformance of the obligation to pay the royalty.

(o) : Facts without any dispute, Gap evidence 1, Gap evidence 2, Gap evidence 3, Gap evidence 6-2, fact-finding results with respect to Leecheon Tax Office of this Court, the whole purport of the pleading, and the whole purport of the pleading)

2. Determination:

Where an exclusive licensee of a utility model right, such as the contract in this case, agreed to pay royalties according to a certain rate for future exploitation of the utility model right, there is no royalty to be paid to the owner of the utility model right unless the exclusive licensee implements the utility model, and thus, the exclusive licensee is obligated to implement the utility model in this case. According to the above recognized facts, the defendant did not implement the utility model in this case after the establishment of exclusive license for the utility model right in this case and did not pay royalties to the plaintiff. Accordingly, the contract in this case was lawfully terminated upon the notice of termination of the contract at July 13, 2001. Since Article 10 (4) of the Patent Act, which is applied mutatis mutandis by Article 42 of the Utility Model Act, is not sufficient to acknowledge the establishment of a pledge right for the purpose of the utility model right in this case, and the defendant's use of the utility model in this case's certificate No. 1 to 7 of this case without the plaintiff's consent to use the utility model in this case's evidence No. 97 of this case.

3. Conclusion

Thus, the defendant is obligated to execute the procedure for cancellation on July 13, 2001 with respect to the registration of the establishment of this case to the plaintiff. Thus, the plaintiff's claim of this case is justified.

Judges Kim Jong-young (Presiding Judge)