Interview with the Lusheng IP Service Team
A few years ago, an American IT giant wanted to negotiate a patent transaction with a Chinese state-owned company. Executives and a senior in-house lawyer from the United States visited China three times but were unable to advance the deal because of differences in the core transaction structure and a failure of the Chinese lawyers recommended by the IT giant’s local subsidiary to give effective advice. After being introduced, the senior in-house lawyer had a 30-minute phone call with Ling Jin, asking for a solution to close the deal. "The value of the 30-minute call far exceeds what I gained from my previous trips to China," the lawyer said after the call. The lawyer then engaged Ling's firm to handle the work on the patent transaction. Based on Ling’s outstanding performance on the project, she was engaged to provide other legal services for the IT giant in China.
Today, Ling Jin has become a partner of Beijing Lusheng Law Firm (Lusheng), specialising in commercial law practice. Lusheng is dedicated to providing the full range intellectual property (“IP”) protection services. This includes market access, cross-border IP transactions, IP litigation and dispute resolution, registration and related legal services of patent, copyright, trademark, and the right of new plant varieties. It is approved by the Chinese State Intellectual Property Office (SIPO) as a qualified patent agency. With its headquarters located in Beijing, Lusheng also branch offices in Shanghai and Guangzhou. It provides clients with high-quality, professional and international IP services.
An Amazing Turnaround: A Legislator Becomes a Leading Commercial Lawyer
A China IP journalist met Ling Jin at the Shanghai branch of Lusheng. Ling Jin, a highly praised lawyer in the field of commercial law practice, did not look like a legal superwoman. She looks approachable with her long black skirt, long shawl hair, gentle smile, and softly spoken manner. In the interview, Ling talked about her time with the Lusheng commercial law team.
Ling worked on legislation for 10 years at the Legislative Affairs Office of the State Council of the People's Republic of China before transitioning to private legal practice. "It was a bold but correct decision,” Ling says about her career change 19 years ago. “My previous work experience helped me to understand Chinese laws and policies from a high strategic level. In my subsequent legal practice, this has proven to be a unique advantage."
In 1997, Ling was awarded a scholarship to study IP law at the University of Melbourne, one of Australia's top law schools. While studying in Melbourne, Ling had the opportunity to undertake work experience with local law firms. She was pleasantly surprised that she could apply her experience at the Legislative Affairs Office of the State Council to private legal practice. Working in legal theory could not give Ling "the feeling of implementing the law". Only by applying her years of experience in legislative work to legal practice could she gain that satisfaction. Ling admits that this was the "most important reason" for her career change.
During her 19 years in legal practice, Ling has developed Lusheng’s commercial legal service from scratch to success. Today, the commercial legal team has become one of the main service sectors of Lusheng. "When I first joined our team, we mainly dealt with IP dispute resolution and trademark agency services, but there were only a few IP related commercial legal transactions. In the years after the establishment of the commercial law team, China’s accession to the WTO coincided with rapid economic development. The continuous improvement in IP protection, and the huge increase in client demand for IP related commercial legal services made my work experience in the Legislative Affairs Office of the State Council very useful.” During the years she was working at the Legislative Affairs Office of the State Council, Ling focused in the fields of education, science and technology, culture, health, and intellectual property rights (“IPR”). She also participated in a series of IPR related domestic law revisions and international negotiations, including some far-reaching Sino-US negotiations on IPR.
In the interview, Ling mentions China’s accession to the International Union for the Protection of New Varieties of Plants (UPOV). She states "According to the requirements of WTO, China should establish relevant laws and regulations in the field of new plant varieties. As a person in charge, I participated in the whole process of the negotiation of China's accession. Since this is a relatively ‘niche’ field compared to copyright and patent, a lot of relevant content needed to be negotiated and agreed with members of international organisations by me personally." This has earned her the trust of her clients, and her experience in successfully completing some large projects in this "niche" field has given her great satisfaction. She says, "The difficulty of applying for a new plant variety right lies in the seedling planting test of three characteristics (distinctiveness, consistency, and stability), especially when transplanted from overseas to China. It often faces the challenge of uncertain factors, such as import quarantine, planting sites, climate, pests and diseases, seedling loss, etc., which may lead to problems of a long application period, high application costs, or even failure of the application for the right to the new plant variety. The Lusheng team has rich experience in handling such cases and can provide clients with cost-effective solutions." The commercial law team once helped a major European agri-food giant carry out various work relating to the regulatory, commercial business, and technology licensing of plant variety rights. This included the full legal and IP due diligence on various potential licensees before deal negotiations, as well as the deal negotiation and post-deal registrations.
The Full Range of Services throughout the Life Cycle of IP
In 2018, the success of Lusheng’s commercial law team was clear, with more than 400 newly opened cases. "Unlike litigation cases, one case with the commercial law team means one project which involves many complex issues, so a case often involves a lot of people and effort," Ling explains. She says that previously clients were mostly foreign-invested enterprises, but in recent years Chinese enterprises’ demands for service has been ever increasing. In 2018, the team worked on a project with a well-known Chinese listed company purchasing 4 Chinese factories of a US company. The US company’s affiliate in Hong Kong was also involved. Multiple issues were involved in this project, such as compliance with domestic and foreign laws. "At that time, we made several business trips to Hong Kong to participate in the negotiations and expended a lot of effort handling the case. Eventually the project was a complete success and it earned us the trust of the client. The client has now engaged us to provide the full range of services for their project in Europe," Ling says.
Ling introduced other services that the Lusheng commercial law team provides. Due to the diverse nature of Lusheng’s clients, the team divides its services into "Hard IP " and "Soft IP". "Hard IP" services cover the fields of patent and know-how, including the technology license agreements of patents, technology transfer, etc. Ling mentions that the team once acted for an Israeli technology company with a revolutionary aluminum-air battery technology who were signing a significant joint venture (“JV”) agreement with a large state-owned listed company and other investors in China. "At that time, our work included conducting full legal and IP due diligence into the state-owned company and its affiliates; reviewing their patents and technology capabilities; advising and negotiating with other JV partners on the framework agreement, the JV agreement, the technology license agreement, and other agreements," says Ling. The Israeli technology company highly praised the quality of the service provided by the Lusheng commercial law team and the importance of the team’s efforts in achieving the first global commercialisation of its new technology. With more than 20 years of experience in IP practice, the Lusheng commercial law team is better placed than ever to assist foreign enterprises with “Hard IP” technology to explore the Chinese market. Industries of particular interest to China are clean energy technology, life sciences, and communications.
The Lusheng commercial law team also provides a wide range of "Soft IP" services. In addition to the traditional trademark and copyright services, it also covers entertainment law, sports law, and other related services. A leading global sportswear company approached Ling's team, hoping that the team could help it expand into the Chinese market. "We set up a representative office for the client and then later assisted it in establishing a wholly foreign-owned trading company in China. With the growth and development of the client's business, we provided timely and efficient legal services to help the client build commercial contractual relationships with various stakeholders and guide the client in regulatory and complex commercial issues in China. Lusheng also negotiated with celebrities, sports associations, sports event organisers and agencies on behalf of this client and drafted various sponsorship agreements to ensure the integrity of the entire agreement framework."
Lusheng law also has a specialist service sector team which focuses on the comprehensive legal issues involved in the marketing, advertising, and digital industry. It covers business agreements (including sponsorship, endorsement, co-branding, and marketing agreements), digital advertising, advertising licenses, franchising, e-commerce, and data protection. According to Ling, since 2008 Lusheng has been accumulating rich experience in advertising legal affairs as the exclusive outside legal team of an American advertising giant in China. "Launching this service has catered to the new needs of our clients," says Ling, "with the advent of the era of Big Data, we are finding online legal issues more and more diverse. Business compliance and content review, cybersecurity, personal data protection, and other issues are becoming increasingly prominent, and these issues are closely intertwined with IP issues."
While expanding into new service areas, Ling's team has not abandoned traditional commercial legal services. The team still dutifully provides clients with the basic legal services of setting up companies and obtaining business licenses. Why are these services that seem to have little to do with IP still offered by the team? Ling explains, “These services can help us keep abreast of the latest developments in business operations, including issues of tax, accounting, auditing, and the establishment, operation, and finance of companies. This lets us grasp key issues in legal and IP due diligence more quickly. They don't seem to be relevant to IP issues, but they do play an important role in actual deals." Ling explains that it was based on her in-depth understanding of commercial law practice that the team successfully avoided a large commercial risk for a client. "Once, an overseas company engaged our team to do legal due diligence on its technology transfer project. And we managed to promptly inform the client of the risk of a pricing problem in the IP transfer. IP transfer pricing is different from general transfer pricing, it is difficult to discover hidden risks if one does not have experience related to IP practice and commercial law." Ling then pointed out that the traditional commercial legal services can not only help the team to provide IP related legal services, but also help to effectively improve a clients stickiness. "A lot of big clients who engage us to deal with IP related business also have many general commercial issues to be dealt with, and it may cost them effort and money if they have to find another team for these services. Our team's ability and experience in providing basic commercial legal services has helped us better attract clients," she says.
Cross-Border Integration: Continuously Promoting the Strength of the Team
During the interview, Ling recounted several complex and difficult projects that she had successfully represented, as well as the trust and praise of the team from the clients. Why do so many clients speak highly of Ling’s team? "Our team has been thinking from the clients’ perspective while providing services. When we encounter problems, we do not emphasise to them how difficult the problems are. Instead, we focus on understanding the risk and trying to find solutions for them," says Ling. Lusheng’s Managing Partner Zaiping Zhang says, "Because of her background of working at the Legislative Affairs Office of the State Council and her deep understanding of government, Ling is able to grasp the intricacies of policy, analyze problems from the strategic level, actively seek solutions to achieve clients' business demands and finally facilitate the completion of business transactions. This is where the Lusheng commercial law team has an edge over other commercial law teams."
Ling advises that many of the team's projects involve cooperation with state-owned enterprises. "When a foreign enterprise cooperates with a state-owned enterprise, it is often the case that the project is difficult to advance because the parties do not understand each other. I have a solid understanding of the needs of both foreign and state-owned enterprises, so I can be a bridge in the project, gain insight into the needs and concerns of all parties, and help them to reach a consensus,". Ling continues, "people are often terrified of the unknown, but when I let the parties know each other and provide solutions to key issues, the deal will naturally fall into place. Because the solutions we propose always take into account the needs of both parties, our project partners are often full of praise for our team. As our experience accumulates, more complex projects better reflect the advantages of our team."
After years of working as a lawyer, Ling has also summed up a set of experiences to improve her professional ability. In her opinion, "integration" is the keyword for lawyers in the era of artificial intelligence. "After working in the IP industry for a long time, you find that law is just a product of an economic stage, which is always lagging behind. As a lawyer, we should not only focus on the legal matters but also how to integrate with our clients' industries. Only by going deep into a clients’ industry can we better understand their needs and help them achieve their business goals. In an era of artificial intelligence, the more comprehensive the ability one has, the more difficult they are to be replaced. Building the comprehensive ability of lawyers in the team is an important foundation of Lusheng in the future. Artificial intelligence will eventually replace lawyers who only provide ordinary services, while lawyers who dare to break through and cross the boundaries will be able to maintain a long-term competitive advantage," says Ling. While the team mainly focuses on non-litigation legal services, she often asks team members to get involved in litigation cases, she says, "Litigation helps us better understand the actual risks in a transaction, so we can better serve our clients."
A strong team of elite lawyers is a key factor in Lusheng's rapid expansion in recent years. According to Ling, team members all have their own areas of specialissation, covering IP, commercial law, and overseas business. The team adopts a "client-centric" working style, and the role boundaries of each member are deliberately kept broad. "Every member of our team has a strong interest and knowledge of IP. We also place a high value on the comprehensive ability of our team members, because a complex business project often requires the integration of different aspects of knowledge,” says Ling. She also points out that "empathy for others" is the main reason Lusheng maintains the stability and cohesion of the team. "If what team members care most about is personal fulfilment, Lusheng will provide them with a platform to realise their self-worth. If team members want to work in multiple areas and develop their comprehensive ability, Lusheng will encourage them. In addition, an atmosphere of teamwork and a positive learning culture are important reasons the team maintains momentum,” she says, “but that does not mean we advocate the idea of 'all work, no life'. I always believe that work is for pursuing an ideal life. If you cannot enjoy your life, then work will lose its meaning. Our team members all enjoy their own unique hobbies.”
The future of the Lusheng commercial law team looks bright, and both Ling and Zaiping Zhang have their expectations. Zhang says "Commercial legal services is a feature of Lusheng, which can now provide clients with the full range of services throughout the life cycle of their IP. In the current environment of fierce competition in the legal industry, this aspect of our service is a very promising development. I hope in the next few years, the commercial law team will be able to improve service quality even further and also increase the size of cases." Ling, on the other hand, expressed her expectations from a service perspective, "As a legal specialist, everyone wants to be as professional as possible, which is important. However, in my opinion, lawyers must also provide services from a commercial perspective rather than only from a legal perspective, and present clients with commercially oriented solutions.”
This interview was originally published in China IP Magazine with the title "Lawyers Who Play a Double Role in IP and Commercial Fields - Interview with the Lusheng IP Service Team"