According to U.S. law, only a licensed U.S. attorney or law firm may represent and defend an enterprise in the ITC. In order to ensure an absolute victory in the ITC investigation, JK recruited a 9 member law team comprising senior lawyers in the most renowned law firms within the intellectual property field with the Fish & Richardson law firm specialized in patent law as the main defense attorneys. JK also received the most reliable chemical specialist in the U.S. as the expert witness. In July 2007, JK submitted its application for participation in the ITC-337-TA-604 investigation of all the five sucralose patents. The lawyers of Tate & Lyle tried their best to object the application of JK, because the participation of JK not only disrupted the strategic plan of Tate & Lyle, but also cost the lawyers of Tate & Lyle even more time and expenses. Furthermore, Tate & Lyle did not have any prepared evidence and legal plan for JK as it was caught by surprise, further increasing its likelihood to lose the case. JK presented the following arguments pursuant to the law of ITC: (I) products of JK had already been exported to the U.S. market; (II) there existed clients and prospective clients of JK in the U.S. market; (III) the three accused enterprises could not represent the interests of JK due to their divergent production methods; (IV) the application for general exclusion order by Tate & Lyle had already seriously harmed the market interests of JK; and (V) JK could complete the evidentiary presentation and defense pursuant to the statutory procedures of the ITC and thus had no problem catching up in the legal proceedings. Thanks to the active defense by the defense attorneys of JK, on 15 August, 2007, the judge and commissioner of ITC agreed that JK could participate in the ITC-337-TA-604 investigation in connection with the sucralose products on its own accord. Thus JK became the first Chinese production enterprise that applied for participation the ITC investigation on its own initiative. In addition, JK made a statement to the world on the renowned American website FLEXNEWS that JK Sucralose fully respects the intellectual property rights of other entities, and expects that others should in return, respect the intellectual property rights of JK.

According to the procedural requirements of ITC, all the materials (including materials stored in the computer, text materials and mails) of JK must be submitted to the lawyers of Tate & Lyle. As per the requirements, JK sent thousands of pieces of materials reviewed by its Chinese attorneys to its American defense attorneys, and after the careful selection, said materials were sent to the lawyers of Tate & Lyle in accordance with the procedural requirements. The number and budget of the lawyers of Tate & Lyle were increased due to the participation of JK. According to the procedural requirements, Tate & Lyle must complete the investigation of JK within the statutory period. Based on the materials submitted by JK, Tate & Lyle cross-examined one company witness and three technical witnesses of JK for around three days (beginning 5 October, 2007) and collected relevant evidence. The persons present included the American defense attorneys of JK and their Chinese interpreter, lawyers of Tate & Lyle, and officials of the ITC and their Chinese interpreter. Sound recordings and photographs were taken during the whole inquiry and evidence collection process. Based on the materials submitted by JK and the inquiry of witnesses by its lawyers and experts, Tate & Lyle, accompanied by the officials of the ITC and the American attorneys and Chinese interpreters of JK, took pictures and samples of the on-site production process in the factory of JK on October 30, 2007. In order to find implicating evidence, Tate & Lyle even took samples of the dust on the factory floor for laboratory testing, hoping to find evidence unfavorable to JK. All the samples collected by Tate & Lyle were promptly sent to the American laboratory designated by Tate & Lyle through express mail with thermal insulation service. To ensure the accuracy of the test data of the samples, JK also sent the samples to its designated American laboratory through the same means of thermal insulation and refrigeration. In order to secure an absolute victory, the American defense lawyers of JK conducted investigation on the main patent applicants of Tate & Lyle in England pursuant to the statutory procedural requirements, as well as the investigation of the actual use of such patents in the U.S. In addition, the lawyers of JK researched and analyzed numerous documents and materials to prove the invalidity of the patents of Tate & Lyle. According to the statutory procedural requirements of ITC, the company witness, technical witness and expert witness of JK conducted a debate in the court on February 28, 2008, and on the same date, the evidence submission period expired. Video recording and photography were used during the whole aforementioned process.

Based on the evidentiary materials submitted by the two parties and the debate in the court, the third party lawyers of ITC made the same decision before and after the hearing that the production techniques had not infringed upon the patents of Tate & Lyle and the “463” patent of Tate & Lyle was invalid. After receiving sufficient opinions of the two parties during the hearing and comprehensively reviewing the case materials, the administrative judge of ITC decided on September 22, 2008 that (I) the sucralose and the down-stream products of JK thereof imported to the U.S. had not infringed upon the four patents (No. 4980463, 5470969, 5498709 and 7049435) alleged by Tate & Lyle; (II) the ITC had no jurisdiction over the No. 5034551 patent alleged by Tate & Lyle; and (III) there was no domestic industry relating to the No. 4980463 patent. Based on the abovementioned decisions, ITC ruled that except for the absent and losing parties, the production techniques of JK and the three accused Chinese enterprises had not infringed upon the patents of Tate & Lyle.

This investigation also involved the product on which the production of sucralose is based, the precursor sucralose-6-ester. According to the regulation of the ITC, semi-finished products were not subject to the jurisdiction of the ITC because they had not been imported to the U.S.A. However, because the semi-finished product could be only used for the production of sucralose, the ITC judge decided to accept the case in connection with the semi-finished product, which would become a precedent of the ITC since no semi-finished product in history had been subject to the jurisdiction of the ITC. The ITC judge had made 8 decisions to adjourn the trial because the commissioners of the ITC had differing opinions, many patents of the semi-finished product were involved, and there were no sufficient supporting regulations. The trial lasted for nearly 24 months, which was very rare in the history of the ITC.

The competition of international business is the competition of intellectual property rights. Due to its status as a relatively new form of high intensity sweetener with the qualities of being safe, good tasting, good processing mechanics, zero calorie, and suitability for obese and diabetic people around the world, sucralose will be relevant in the sweetener market globally for at least 100 years. The primary markets of the product are the U.S. and Europe. Since the U.S. market is the largest sucralose market globally, the intellectual property rights battle is unavoidable for the entrance into such market. Before the entrance to the U.S. market in 2006, JK had already engaged American patent lawyers to compare its production techniques with all the patents of Tate & Lyle, and confirmed no infringement of the patents of Tate & Lyle. Therefore, in 2006, JK had already made advanced preparations for the patent suit.

The legal battle is synonymous with the battle for the market. JK fully realized that in order to win the market, it had to win the battle in the courts first. Therefore, in order to protect and develop its market status, the initiative in the legal proceeding was needed, while market promotion would simultaneously be enhanced during the trial, sales channels would promptly be established and perfected when the other enterprises failed to market their products smoothly due to the legal struggles, and the most renowned clients in the market would select JK to be their supplier of choice. By these means, the lawsuit would be supported by JK’s continual expansion of its status in the market. Due to these strategic actions by JK, the trial could be sustained indefinitely by JK due to its ever expanding market position creating the foundational support for its battle in the courts. According to American law, once a legal case has begun, the plaintiffs must stay away from the products of the sued enterprise until the lawsuit is resolved. In order to achieve its goal of supporting the battle in the courts with its position in the market, JK had to maintain a strong and steady sales channel in the market without any obstacles during the multiple year lawsuit.

The intellectual property rights lawsuit was to be treated as an investment and part of JK’s investment strategy as a whole. The investment in intellectual property rights is like an investment in an “ideological factory” in which JK could use its physical resources in the market in order to create ideological benefits which could only bring tangible physical benefits to JK in the future. Through the licensing of manufacturing technologies that do not infringe other people’s rights and the use of independently owned factories to produce its products, JK’s investments in fixed assets and other investment risks could be decreased accordingly.

JK could familiarize itself with legal procedures. The Internal Trade Court, local courts and the ITC all have their own legal procedures. Through fighting this battle, JK could gain valuable experience in the field of intellectual property law while also developing its market position and sales strategies on the basis of specific legal procedures.

It was of great strategic benefit for JK to enter this lawsuit. Using its status and knowledge gained from its participation in the suit, JK could leverage its position in the international market and networks to expand its sales opportunities, potential client base, and put its investments into its new state of the art factories to its greatest possible use, all while limiting its capital spending. The production facility as a fixed asset, would be utilized to the most efficient extent, reducing the true cost of investment, creating the highest value obtainable using JK’s limited resources.

Enhanced popularity: JK was founded in January 2006 and originally lagged behind many other companies within the same industry, some which had been established for over ten years. Since JK participated in the ITC-337 investigation on its own initiative, many enterprises within the field of food additives and food and beverages manufacturers began taking notice of JK’s name and brand, thus skyrocketing its popularity to the number two position globally.

Accelerate the establishment of global sales network: Because of JK’s active participation in the ITC investigation, distributors and clients across the world began taking the initiative to come and negotiate business and sign deals with JK, and its global sales network, covering North America, Europe, South America, Asia, South Africa and Australia was established within a very short period of time.

Securing the market: According to American laws, if Tate & Lyle sued JK in the court at first, and there were clients currently purchasing products from JK, then Tate & Lyle could in turn, sue the clients of JK in the court at any time. Because JK participated the investigation on its own initiative, Tate & Lyle was unable to add the clients of JK to the list of defendants. Therefore, JK secured its own position in the market, the safety of its clients, and ensured a steady sales stream for the duration legal battle.

Exportation and productivity rose to the first in China: Due to JK’s participation in the investigation, in 2008, within one year, its sales rose to the number one position in production and exports in China, and the second in the world

Acceleration of production expansion: Due to the expansion of its sales networks in the global markets due to the publicity of JK’s role in the ITC investigation, JK’s products were in constant short supply and in high demand. Under the tense and unfavorable economic circumstances caused by the global financial crisis of 2008 and the depreciation of U.S. dollar, Euro, Pound and other international currencies, the sales of JK increased at a rate of 50-80% annually, and would continue to expand at such a rate for the foreseeable future.

Maintaining the interests of investors: Because of JK’s complete victory in the ITC investigation and integrated sales network across the global market, the legal risks of investing in JK in the global market had been eliminated, and thus the interests of banks and investors could be maintained to the greatest extent.

Attracting senior managerial talents to the company: Because of JK’s success in the lawsuit and the publicity gained, sales and managerial talents around the world began prospecting positions at JK, a newly-founded enterprise with huge growth potential, further ensuring JK’s rapid development to become a global force in the food additives market.