Multinational corporations should be careful in ordering souvenirs and make sure that their components do not infringe patent rights, an official said.

The remarks were made by Tan Xiyu, spokesperson of Guangdong Deqing county government, who himself has been involved in several campaigns to crack down on pirated batteries.

Several multinational corporations, including McDonald's, Coca Cola and Pepsico have ordered souvenirs powered by "Pakko" mercury-free button cells, he said. The cells infringe the patent rights of Hong Kong-invested New Leader (Deqing) Battery Industry Ltd.

The "Pakko" cells are the products of Hong Kong-invested Pak Ko Battery Factory Ltd, located in Sihui, a city neighboring Deqing County in Guangdong Province.

"We have found that a big toy factory in Dongguan has supplied a large number of souvenirs powered or signaled by the "Pakko" mercury-free button cells to McDonald's, while an electronic factory in Huizhou has also supplied electronic souvenirs using the same battery brand to McDonald's, Coca Cola, Pepsico and Philips," he said.

"New Leader has been suing the pirates. They (the multinationals) should have known better that they might be sued for ordering such souvenirs," he warned.

According to Zhang Pinghai, a lawyer in Guangzhou, those who have ordered products with pirated components will be considered patent violators if they knew that the components infringe other's intellectual property rights.

The two battery companies have been in a tug of war over the patent issue in the past few years.

In late 2002, Pak Ko appealed to the State Intellectual Property Office to re-appraise the validity of the patent for the mercury-free button cells developed by New Leader. The patent was deemed void by the State office in May 2004.

New Leader brought the lawsuit to a court in Beijing, which upheld the verdict of the State Intellectual Property Office.

The Beijing High People's Court gave a final judgment in favor of New Leader in late 2005.

A senior executive with Pak Ko Battery Factory Ltd, who identified him only as "Deng", told China Daily that his company has been doing business legally and his products have no piracy problem.

"If our company had been a pirate for so many years, why have the authorities not closed down our company," Deng said.

According to the website of New Leader, the firm has sued different factories of Pak Ko for patent infringement from 2004 to 2006, and has demanded compensation of 10 million yuan ($1.28 million). All of the cases are still pending.

Local customs and intellectual property administrations have confiscated "Pakko" mercury-free button cells on several occasions.

Editor: Yan