I did a post the other day implicitly complaining about how long it takes for Chinese trademark registrations to go through. In response to that post, Stan Abrams over at China Hearsay, in a post entitled “China Trademarks: That Pesky Perennial Pendency Problem,” wrote of the opposite concern: what will happen to accuracy if China’s trademark office does manage to increase its speed: 

Talking to folks I know that do a large volume of registrations (including the head of my firm’s TM group), they have seen some real changes [in terms of additional personnel at the Trademark Office]. Indeed, some are actually worried that the push for speed will have some negative effects on quality, which ironically might mean some poor registration decisions and could potentially lead to a higher volume of oppositions and appeals.

This might mean that registration times will be reduced and yet the workload of the Trademark Review and Adjudication Board (TRAB, the guys who handle oppositions, cancellations, and appeals) might increase until the new examiners get up to speed and quality improves. Other changes have been instituted over the past year or so that might speed things up at TRAB, but these reforms have their own drawbacks, and some of them might push dissatisfied folks to use the court to appeal administration decisions. {sigh}

Very valid point.

My firm’s experience with China’s trademark office is that the people there are, for the most part, eminently qualified and careful. Will this be the case for its new hires? Will the promises of faster turnaround time lead to a decrease in quality?  

The law often faces a tension between speed versus accuracy and I see this as most pronounced in a litigation context. One of my oldest client relationships is with a mini-conglomerate out of Eastern Europe, run (like most mini-conglomerates out of Eastern Europe) by a very tough, very smart, very strong-willed guy. For years, this guy would bitch and moan to me about how slow his litigation matters would go in the United States, but in the end, we won or achieved excellent settlements in every single one of his company’s cases.

Nonetheless, he would still talk of how the courts here have too much power and take too long and of how discovery is killing business and of how eventually all of this would have to change or the United States would start losing business. My response was to point out how well his businesses were doing here and to tell him to take it up with the politicians. Sort of an “I just work here approach.”  

Then out of the blue, he personally got involved in a couple of cases in his home country and from then on our lunch-time conversations would tend towards his complaining about his inability to conduct full on discovery there. It was driving him nuts that his lawyers would not be able to depose witnesses my client knew to be lying. It was also driving him nuts how quickly the judges were ruling on issues in the case, before, my client felt, he had sufficient time to gather up all evidence. He actually admitted he was pining a bit for an American case, where the judges tend not to rule until all sides have had more than ample time to gather up everything needed for their case.  

China litigation is the opposite. To a large extent, your case consists of the documents you have going into the case and if those documents are not enough to prevail, well, too bad. And unless the case raises really thorny issues (in which case Chinese judges have a somewhat annoying tendency of refusing to rule and just instructing the parties to settle), quick rulings are the rule not the norm. What this means in dollars and sense is that a Chinese legal matter can end up costing way less than a U.S. one because the lawyers in China end up having to do way less.  I have been involved in cases in China that went from commencement to ruling in three to four months and cost 1/5 to 1/10 what they would have cost in the United States, where the same ruling might have taken three to four years. 

In describing this situation I often say that in the United States you pay $500,000 and spend three years and the courts rule correctly 98% of the time and in China you pay $50,000 and spend six months and the courts rule correctly 90% of the time. I am wildly guessing with these numbers (and of course the litigation cost figures can be all over the map), but they are not all that far off and they do convey the differences. I then ask which system they would prefer and they nearly all pick the faster one.

There’s an old saying in the product outsourcing business that you can have quality, price, delivery date, but you have to pick two. Some call this the Law of Two-Thirds:

When you go to college you’re told you can have good grades, a good social life or sleep – pick two. Business is no different. Almost everything we buy can be boiled down to quality, speed or price – pick two. A Rolls Royce, for example, is made from the finest materials and costs a lot of money. But they take a long time to make. A Toyota Camry, in contrast, is fast and cheap and though the quality is good, it’s not the best.

The law has its corollary. You can have price, quality and speed, pick two. 

Speed versus accuracy. 

What are your thoughts?