Original design was imitated within 3 months of launch; Shenzhen company wins 3 million in lawsuit, lawyer reviews the key step.

An industrial design company in Futian, Shenzhen, spent over half a year refining a smart home product and filed for as many as 6 patents, including design patents and utility model patents. Less than three months after the product hit the market, a counterfeit version from a factory in Longhua flooded e-commerce platforms at half the price. When the design company's owner discovered the competitor was selling over 8,000 units per month, he angrily sent us the product teardown report and sales screenshots that very night.

The conflict quickly escalated. The copycat factory didn't just copy the appearance—even the internal structural layout of the product was nearly identical. The design firm first sent a legal letter on its own, but the other party replied with a lukewarm, dismissive response denying any infringement and went right back to production. What's worse, the factory took one of the design firm's core technical solutions and filed its own utility model patent application with it, then turned around and claimed the design firm was the infringer. This tactic of "turning the tables" is hardly rare in Shenzhen's manufacturing industry.
After taking on the case, the first thing Attorney Shen Jinlong's team did was not to rush into filing a lawsuit, but to secure the evidence. Many rights holders suffer precisely because of evidentiary issues—having product comparison images alone is not enough; they must prove the other party's manufacturing and sales chain, and also have the patent that the other party applied for invalidated. We traced back through the sales data on e-commerce platforms to the logistics warehouses, pinpointed two production sites in Longhua and Dongguan, and applied for preservation of evidence. This step was crucial, because Article 81 of the Civil Procedure Law permits the application for preservation of evidence that may be lost or difficult to obtain. We sealed up the samples, account books, and production records before the other party could transfer their inventory.
In legal analysis, this case has two core points of dispute. First, whether the patent filed by the opposing party is valid. We obtained public sales records and design drawings predating the filing date of the opposing party's patent, proving that the technical solution had already been disclosed when the design company's product was launched on the market. Under Article 22 of the Patent Law, it lacks novelty. We filed a request for invalidation with the China National Intellectual Property Administration, and eight months later, the opposing party's patent was fully invalidated. Second, how the amount of damages should be calculated. The opposing party argued that profit margins were thin, but the sales data we retrieved from the e-commerce backend is conclusive—8,000 units sold per month at a unit price of 399 yuan, with nearly five months from product launch to the filing of the lawsuit, bringing total sales to approximately 16 million yuan. Under the statutory damages cap for patent infringement, where malicious infringement involves serious circumstances, the court may award up to 5 million yuan.
In our representation strategy, we did not follow the old path of "criminal first, civil second," but instead pursued both tracks in parallel. The civil lawsuit demanded cessation of infringement, destruction of molds, and compensation for losses, while simultaneously reporting the other party's false advertising to the Market Supervision Administration—the counterfeit products were marketed under the banner of "same as original factory," which constitutes unfair competition. With pressure applied on both fronts, the other party's cash flow and distribution channels were both disrupted, and the leverage in settlement negotiations naturally fell into our hands.
The outcome reversed two weeks before the trial. The opposing party proactively proposed a settlement, offering 3 million yuan in compensation, and agreeing to destroy all molds and inventory and issue a public apology. The design company's owner had originally expected that getting 1 million yuan would already be good, and this result exceeded his expectations. We ran the numbers: the opposing party's profits from infringement far exceeded 3 million, but given the litigation timeline and enforcement costs, receiving a guaranteed high compensation and quickly cutting losses was a better deal than spending two years on an uncertain lawsuit. Of the 3 million, attorney fees, notarization fees, and invalidation declaration costs were all borne by the opposing party.
This case can be won, but the core lies in one word: speed. From discovering the infringement to preserving evidence, it took less than 20 days. Many Shenzhen companies only seek lawyers after suffering losses—by then, e-commerce listings have been taken down, factories have relocated, evidence is gone, and pursuing rights becomes difficult. Intellectual property cases in Shenzhen grow by 15% annually, and courts are increasing damages for willful infringement, but the prerequisite is that you have a genuine and solid evidence chain in hand.
**Q:** What should be the first step when you discover your product has been counterfeited?
**Answer:** Don't rush to send a lawyer's letter yet. Sending one is like beating the grass and startling the snake — the other party may transfer inventory overnight or tamper with backend data. First secure the evidence yourself: purchase with notarization, screenshot the store's sales figures, and record the shipping location. Then have a lawyer assess the infringement comparison and decide whether to pursue administrative complaint or court litigation. Once the evidence is solid, every subsequent step puts you in a proactive position.
If you encounter trademark squatting, patent infringement, or leakage of core technology in Shenzhen, don't delay. Every extra day infringing products stay on the market, the more you lose. Call 0755-25986969 directly to reach Zhiming Law Firm. With 26 years of case-handling experience, the team led by Senior Director Attorney Shen Jinlong will help you map out your rights enforcement strategy and assess whether your case is worth pursuing and how to secure compensation.