Gree loses patent lawsuit against Aux and to pay $26 mln in damages

China’s Ningbo Intermediate People’s Court of Zhejiang province in December ruled in favor of Aux Group in two patent lawsuits against Gree Electric over its two infringing models of air conditioners and awarded Aux Group 96 million yuan ($15 million) and 70.6 million yuan ($11 million) in damages respectively.


In December 2018, Aux Group acquired the patent CN00811303.3 covering an air conditioner compressor from Toshiba Carrier Corporation, which was to expire in 2020. In January 2019, Aux Group filed a lawsuit against Gree Electric for infringing the patent in question.


In September 2020, Gree Electric petitioned to invalidate the patent before the China National Intellectual Property Administration (CNIPA). In the complaint, claim 3 and the part of claim 10 citing the technical solution of claim 3 in the patent are requested to be invalidated. In September 2021, the CNIPA granted a partial invalidation of the patent.


The trial court heard the two cases filed by Aux Group in July and October respectively. The court found that Gree Electric’s technical solution infringed claims 1 and 10 in the patent, rejecting Gree Electric’s prior art defense. In computing the damages Gree Electric owed Aux Group, the court utilized the formula: multiply the sales of infringing products by a reasonable profit rate of infringing products by a reasonable rate of infringing products profiting from the patent. Gree Electric was ordered to pay Aux Group a total of 160 million yuan ($26 million) in damages.