On June 10, 2020, the High People's Court of Guangdong Province rendered the Civil Judgment ([2017] Yue Min Chu No. 97), and the judgment (summary) is as follows:

1. The

defendants Shandong Hualu Hengsheng Chemical Co., Ltd., Ningbo Chemical Research and Design Institute Co., Ltd., and Ningbo Far East Chemical Group Co., Ltd. shall immediately cease manufacturing the melamine production system that infringes the patent number of the plaintiffs Sichuan Golden Elephant Sairui Chemical Co., Ltd. and Beijing Yejing Technology Co., Ltd. as of the effective date of this judgment, and the name of the product invention patent is ZL201110108644.9, and the name is "energy-saving and resource-saving vapor phase quenching melamine production system and its process". The defendant, Shandong Hualu Hengsheng Chemical Co., Ltd., immediately stopped using the melamine production system that infringed the patent for the invention of the product;

2. The defendant Shandong Hualu Hengsheng Chemical Co., Ltd. shall immediately cease infringing the patent rights of the plaintiffs Sichuan Golden Elephant Sairui Chemical Co., Ltd. and Beijing Yejing Technology Co., Ltd. on the effective date of this judgment, with patent number ZL201110108644.9 and the name of "energy-saving and capital-saving vapor phase quenching melamine production system and its process", that is, stop using the patented process and selling melamine products directly obtained in accordance with the patented process;

3. The defendant Shandong Hualu Hengsheng Chemical Co., Ltd. shall compensate the plaintiffs Sichuan Golden Elephant Sairui Chemical Co., Ltd. and Beijing Yejing Technology Co., Ltd. for economic losses and reasonable rights protection expenses totaling 80 million yuan within 10 days from the effective date of this judgment, and the defendants Ningbo Chemical Research and Design Institute Co., Ltd. and Ningbo Far East Chemical Group Co., Ltd. shall be jointly and severally liable for 40 million yuan of them.

In

this invention patent infringement dispute lawsuit, the Company and Beijing Yejing applied to the Guangzhou Intellectual Property Court for filing the case on December 13, 2016, and in March 2017, the defendant filed a jurisdictional objection application with the Guangzhou Intellectual Property Court, and on May 18, the court made a ruling to reject the defendant's jurisdictional objection application; On May 31, 2017, the defendant appealed to the Guangdong Provincial High Court against the Guangzhou Intellectual Property Court's ruling on jurisdictional objection, and on August 30, the Guangdong Provincial High Court rejected the defendant's appeal on jurisdiction and made a ruling that the case should be heard by the Provincial High Court. On November 29, 2017, the Guangdong Provincial High Court accepted the case, and after four court sessions from April 13, 2018 to January 16, 2020, the two parties had many fierce confrontations.

This patent infringement lawsuit is an important part of the company's melamine intellectual property rights protection case, and it is the following February 26, 2018, the State Intellectual Property Office made the "Decision on the Examination of the Request for Invalidation of the Invalidation Request" filed by Ningbo Far East Chemical Group Co., Ltd. against the invention patent of the Company and Beijing Yejing Technology Co., Ltd. for the "Energy-saving and Capital-saving Fumedamine Production System and Process" (patent number: ZL201110108644.9) (No. 34960); In November 2019, after the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council issued the "Opinions on Strengthening the Protection of Intellectual Property Rights", the Guangdong Provincial High People's Court has built a specific practice of "great protection" of intellectual property rights in order to promote the modernization of China's intellectual property governance system and governance capacity, marking that China's intellectual property protection capacity and protection level have entered a new stage, which will have a significant and far-reaching impact on further promoting China's intellectual property protection.