Background
The plaintiffs are the holders of a Korean patent claiming a 13-valent pneumococcal polysaccharide-protein conjugate composition used in pneumococcal vaccines. Claim 1 covers a composition of 13 immunogenic substances (각 혈청형에 대하여 면역원성을 가지는 다당류-단백질 접합체) corresponding to the 13 serotypes targeted by the vaccine.
The defendant, a Korean pharmaceutical manufacturer, produced 13 individual conjugate substrates (개별 접합체 원액) at its Korean facilities. Those 13 individual substrates were then exported for final mixing, formulation, and finishing abroad — where the actual 13-valent vaccine composition was completed. The plaintiffs sued for direct infringement (the export-and-make pattern), indirect infringement under § 127(1) of the Patent Act (production of components used only for making the patented composition), and unfair competition. The Patent Court of Korea (특허법원) dismissed the claims on December 3, 2024. The plaintiffs appealed to the Supreme Court.
The Court’s Holding
The Supreme Court (First Division) dismissed the appeal in its entirety. The decision turns on two doctrinal pillars of Korean patent law and a careful factual finding.
Territoriality (속지주의 원칙). A Korean patent confers exclusive rights of production, use, transfer, lease, and import only within the territory in which the patent is registered. “Production” (생산) within § 127(1)’s prohibition on supplying components “used only for the production of” the patented invention must therefore mean production in Korea. Where the final product is completed outside Korea, indirect infringement under § 127(1) does not arise, even if components are produced in Korea and exported.
All-elements rule (구성요소 완비의 원칙). For a manufactured product to constitute infringement, the product must contain every element of every claim limitation organically combined. The 13 individual conjugate substrates produced in Korea, each corresponding to a single serotype, do not by themselves constitute the claimed 13-valent composition. The final mixing step that produces the 13-valent composition is not trivial: the lower court found that the mixing process — input ratios, sequence, pH, temperature, agitation rate, and agitation time — has substantial impact on whether the resulting product realizes the claimed effect of providing immunogenicity for all 13 serotypes. That mixing step occurred abroad.
Combining these two doctrines, the Court held: the 13 individual substrates, even if all produced in Korea, do not amount to a Korean “production” of the patented 13-valent composition because (a) the mixing step that completes the patented invention happens abroad, and (b) the mixing step is not so trivial that producing the 13 substrates in Korea is functionally equivalent to producing the final composition in Korea. Indirect infringement under § 127(1) therefore does not lie.
The Court distinguished its earlier decision in Supreme Court 2019다222782, 222799 (October 17, 2019), where production in Korea of a near-finished product whose remaining assembly step was “extremely trivial or simple” was treated as Korean production for territoriality purposes. Here the final mixing step is not extremely trivial.
Key Takeaways
- Korean § 127(1) indirect infringement requires the eventual “production” of the patented invention to take place inside Korea. Producing components in Korea for export and downstream foreign assembly is generally not actionable under Korean patent law, even if those components are dedicated to the patented invention.
- The narrow exception is the 2019 “trivial assembly” doctrine: where the in-Korea production is essentially complete and only an extremely trivial or simple finishing step remains abroad, the in-Korea production may be treated as production of the patented invention. The Court here read that exception narrowly and rejected its application to vaccine mixing, characterizing the mixing step as substantively important.
- Patent owners with concerns about export-and-finish manufacturing should consider claim drafting that captures the components themselves (the individual conjugates) as patentable subject matter, in addition to the final composition.
- For Korean contract manufacturers serving foreign principal-product owners, this decision provides meaningful comfort: producing components for export to overseas assembly facilities will not generally trigger indirect-infringement liability under Korean patents that claim only the final assembled product.
Why It Matters
Korea is one of the world’s largest contract-manufacturing hubs for biologics and vaccines. The Supreme Court’s narrow reading of § 127(1) protects that business model: a Korean CDMO can produce dedicated components and export them for foreign final-assembly without triggering Korean patent indirect-infringement exposure on the final composition, so long as the foreign assembly step is substantive. That’s good for Korean contract-manufacturing volumes; it is harder on Korean patent owners trying to police export-and-finish strategies that route final assembly to jurisdictions where the patentee lacks corresponding patent coverage.
The decision also sharpens the line between this case and the 2019 trivial-assembly precedent, providing a practical test: if the foreign step requires careful process parameters (ratios, sequence, conditions) that materially affect whether the claimed invention is realized, the foreign step is substantive and Korean indirect-infringement liability does not lie. Bare relabeling, packaging, or rote final-fill steps abroad would likely fall on the other side of the line. Patent prosecutors and litigators should structure claim sets and litigation theories with this distinction in mind.
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