In a dispute of the appellant Jiao Ruili against the appellee Feed Research Institute of Chinese Academy of Agricultural Sciences (hereinafter referred to as Feed Research Institute) and Daxing District Agriculture and Rural Bureau of Beijing (hereinafter referred to as Daxing District Agriculture Bureau) over the infringement of patent right of invention, the invention patent (hereinafter referred to as the patent involved) with the patent number ZL03143241.7 and the title of "A traditional Chinese medicine feed additive for increasing milk and strengthening cattle and its preparation method" is involved. 

According to Jiao Ruili, the Feed Research Institute and Daxing District Agriculture Bureau used the patented methods involved in the case and manufactured the patented products involved in the case in the scientific and technological cooperation projects from 2006 to 2008. Therefore, she filed a lawsuit with the Beijing Intellectual Property Court (hereinafter referred to as the court of first instance), requesting an order to cease the infringement act of the Feed Research Institute and Daxing District Agriculture Bureau and a compensation for the economic losses and the reasonable expenses for safeguarding rights of 2,618,180 yuan. 

According to the court of first instance, Feed Research Institute belongs to a public institution, and Daxing District Agriculture Bureau belongs to a government agency. Neither of them has the qualification of production and operation, and there is no evidence to show that the implementation of the cooperation project between them is conducted for the purpose of production and operation, and the alleged infringement does not meet the patent infringement requirements, that is, "for the purpose of production and operation". Therefore, the court rejected Jiao Ruili's claim. 

Jiao Ruili refused to accept the decision and appealed to the Supreme People's Court, claiming that the court of first instance had made a mistake in determining that the alleged infringement did not have "production and operation purposes".

On November 25, 2020, the Supreme People's Court revoked the original judgment, and ordered the Feed Research Institute to compensate Jiao Ruili for economic losses of 600,000 yuan and reasonable expenses of 15,000 yuan for safeguarding rights, of which Daxing District Agriculture Bureau was jointly and severally liable for compensation of 215,000 yuan.

The Supreme People's Court held that: the Patent Law regards "for the purpose of production and operation" as one of the elements of patent infringement, which aims to reasonably balance the interests of patentees and the public.

When determining patent infringements, the understanding of "for the purpose of production and operation" should focus on the specific alleged infringement act, and comprehensively consider whether the act belongs to participation in market activities, whether it affects the market interests of the patentee and other factors. One can neither simply associate "for the purpose of production and operation" with engaging in profit-making activities, nor determine that the implementing subject has the purpose of production and operation only based on its institutional nature. Even if government agencies, institutions and other subjects have the attributes of public services and public welfare undertakings, and they do not aim at production and operation, if they carry out market activities and damage the market interests of patentees, they can still be deemed to have the elements of "for the purpose of production and operation".

In this case, the scientific cooperation between Feed Research Institute and Daxing District Agriculture Bureau has certain attributes of public service and public welfare and is not directly aimed at production and operation. However, during the cooperation, the projects involved had produced certain economic benefits and had gained the farmers direct profit.

The manufacture and use of patented products and methods by the Feed Research Institute and Daxing District Agriculture Bureau will inevitably encroach on the possible market of the patents involved and damage the market interests of the patentee. Therefore, the relevant behaviors of the Feed Research Institute and Daxing District Agriculture Bureau meet the requirements of "for the purpose of production and operation", thus the original judgment is revoked.