China tests the long arm of its law in Xiaomi and Huawei’s international patent battles
- Chinese courts are increasingly heeding calls by Beijing to protect the international interests of domestic companies
- China and other countries’ exertion of extraterritorial jurisdiction has alarmed legal experts around the world
A growing clash between courts in China and Western countries seeking to exert rulings beyond borders could escalate, warned legal experts, after a local Chinese court issued an injunction over a dispute between smartphone giant Xiaomi and a US company.
The case, an example of the Chinese judiciary’s intensifying efforts to impose long-arm jurisdiction under Beijing’s directive, can throw international lawsuits into uncharted waters, according to analysts.
It started last June, when Xiaomi took to China’s Wuhan Immediate People’s Court to seek a ruling on its dispute over licensing fees with US technology-patent firm InterDigital.
Around the same time, InterDigital sued Xiaomi at a Delhi, India court, prompting the Wuhan court to issue an injunction barring the US company from taking the case outside China or risk a daily fine of 1 million yuan (US$152,000). An appeal by InterDigital was rejected.
Undeterred by the injunction, InterDigital pursued the case overseas anyway, eventually winning a ruling in India prohibiting Xiaomi from enforcing the Chinese court order. It also obtained a similar counter-injunction from Germany’s Munich Regional Court, paving the way for the company to file a patent infringement lawsuit in the country.
The case has raised alarm among legal experts, worried about its potentially far-reaching implications.