PRC Supreme Court Finalizes DaHui’s Complete Victory for Italian Company in Cross-Border Commercial Dispute

Recently, DaHui’s dispute resolution team led the up-and-coming Italian company, Didofà S.r.l., to victory in a PRC Supreme Court retrial – and to the conclusion of a nearly four-year legal battle with a domestic supplier over a dispute arising out of a nearly RMB 100 million sale of medical goods.

Our client is engaged in the distribution of medical products, and this case centered around a contract for nearly RMB 100 million worth of medical gloves during the COVID-19 pandemic. The supplier unilaterally breached the contract, provided seriously defective products, and refused to cooperate. Unfortunately, our client had not only paid a significant amount of the contract value as an advance, but also paid for several shipments of gloves from this supplier. When our client sought to terminate the agreement on the grounds that the latest shipments of gloves were delayed, defective, etc., our team initiated the lawsuit on behalf of the client and carried the case through several stages to eventual and complete victory.

The case involved many substantive and procedural issues in foreign-related commercial litigation in Chinese courts, including the first instance before the Jiangmen Intermediate People's Court of Guangdong Province, the second instance before the Guangdong High People's Court, and finally to the retrial before the Supreme People's Court.

Led by DaHui partner Edward Lu, with support provided under Italian and EU law by partner Dario Covucci from the renowned Italian law firm LCA Studio Legale, we helped Didofà S.r.l. overcome numerous difficulties – including delays brought on by Covid-19 (which affected everything from document authorization/legalization to evidence collection), an uncooperative and troublesome defendant, jurisdictional challenges, and more – to secure victories at all three levels of adjudication.

We scored these wins by leveraging our in-depth understanding and adept application of the United Nations Convention on Contracts for the International Sale of Goods (CISG) and China's civil and commercial legal system, our precise grasp of the legal issues involved in international trade disputes, and our effective grasp of the burden of proof and preponderance of evidence principles under Chinese law. Along the way, all three levels of the Chinese courts confirmed our client’s termination of the contract as legitimate and awarded our client a full refund for its deposit – the best outcome it could hope for.

The ultimate victory in this case not only safeguarded our client's legitimate rights and interests to the greatest extent possible but also provided a valuable adjudication practice and litigation strategy reference for similar cross-border commercial contract disputes. Furthermore, this case serves as a kind of reassurance for global companies, to know that they have recourse and protection under PRC law when unfortunate circumstances like these arise.

DaHui’s Dispute Resolution Team

DaHui possesses a first-class track record in providing constructive, creative, and practical counsel to help our clients swiftly resolve their commercial disputes inside and outside court. We have represented leading corporations and institutions in many notable cases before all levels of courts across China, involving disputes concerning IP, competition, labor, commercial bribery, construction, product liability, contracts, securities and M&A, and representing domestic and international business leaders.

DaHui continues to be a preferred firm for the most complex, especially cross-border disputes, on account of the consummate analyses and advocacy our litigators bring from and to practicing in multiple forums and before judges as well as at the negotiating table. We also serve as co-counsel and even lead counsel in cases that involve coordinating among attorneys across myriad jurisdictions in high-stakes global disputes. With our own international experience and presence, and lawyers positioned in the United States and United Kingdom as well as China, we regularly deploy a range of procedural approaches, governmental resources, public security and criminal measures, and even intra-industry and PR strategies to efficiently achieve optimal resolutions for our clients’ disputes.