Beijing East IP Law Firm

Jason Wang

November 25, 2013

As a famous luxury hotel band around the world, the RITZ-CARLTON mark owned by Ritz-Carlton hotel was recognized by China court recently. Both the trial court (Beijing First Intermediate Court) and the appellate court (Beijing High Court) overruled the decision of the Trademark Review and Adjudication Board (TRAB), and recognized the RITZ-CARLTON mark on hotel services and restaurant services as a well-known mark. The presiding judge from the appellate court for this case cited this typical case (cited this as a typical case) and posted comments and analysis on China Intellectual Property News on November 8, 2013.

The RITZ-CARLTON case covers at least the following four issues:

1. Rules for well-known mark recognition

According to the statistics, the Beijing First Intermediate Court only recognized well-known marks in some 100 cases from 2001 to 2012. Then, are there any particular rules to recognize a mark as well-known?

According to practices in China, there are three basic rules for well-known mark recognition: 1) recognition based on a case by case situation, 2) recognition based on the party’s request, and 3) recognition based on necessity. The newly added Article 14(1) of the Chinese Trademark Law as amended on August 30, 2013, which shall come into effect as of May 1, 2014, prescribes that the well-known status of a trademark shall be recognized based on the request of the party concerned and as a factual determination for the necessity of the trademark case.

The above provision of the new Chinese Trademark Law has expressly affirmed by the legislation as the rules to recognize well-known marks. In this case, according to the court decisions and the handling judge’s analysis, the hotel services and restaurant services provided by Ritz-Carlton hotel are not identical or similar to those under the Disputed Mark, thus the only remedy to protect Ritz-Carlton hotel’s rights and interests is the well-known mark argument. Therefore, the recognition of well-known mark for RITZ-CARLTON is consistent with the rule of recognition based on necessity and other rules mentioned above.

2. Cross-Class protection or All-Class protection

The courts hold that the Disputed Mark’s designated services for “Residential houses sales services; Real estate agencies” in Class 36 shall be cancelled, while other designated services, like “Brokerage, Guarantees, etc.,” in Class 36 shall remain as registered.

The presiding judge’s comments and analyzes are as follows: Well-known mark protection is a stronger cross-Class protection, but it is not an all-Class protection. Even if a mark is recognized as well-known, such stronger protection shall be entitled only within the corresponding scope. In this specific case of RITZ-CARLTON, the Cited Mark on “Hotel services, Restaurant services, etc.” is recognized as a well-known mark. The Court held that services for “Residential houses sales services; Real estate agencies” designated under the Disputed Mark are related to the hotel services and restaurant services. Therefore, the Court ruled that the registration of the Disputed Mark on “Residential houses sales services; Real estate agencies” is likely to mislead relevant public and prejudice Ritz-Carlton’s rights and interests accordingly. However, with respect to other services under the Disputed Mark, they are not incorporated into the protection scope of well-known mark.

The court ruling as well as the presiding judge’s comments and analysis comply with the Chinese Trademark Law. According to Article 13(2) of the current Chinese Trademark Law and Article 13(3) of the new Chinese Trademark Law, one of the prerequisites for a registered well-known mark is that it “tends to mislead the public and prejudice the interests of the well-known mark owner”. This has been interpreted as that well-known mark recognition will not cover all Classes of goods/services. Instead, it merely covers those Classes which may “tends to mislead the public and prejudice the interests of the well-known mark owner”.

3. English mark protects Chinese equivalent

The Courts held that a close association has been established between the mark LI SI KA ER DUN in Chinese and RITZ-CARLTON via Ritz-Carlton’s use and promotion. Thus, the Disputed Mark LI SI KA ER DUN in Chinese is the translation of RITZ-CARLTON.

According to Article 13(2) of the current Chinese Trademark Law and Article 13(3) of the new Chinese Trademark Law, a mere “translation” of a well-known mark is forbidden. However, the key issue is to establish the close or corresponding association between an English mark and its Chinese equivalent. In this case, the Courts held that Chinese media has adopted LI SI KA ER DUN in Chinese as the major translation for the RITZ-CARLTON mark, and Ritz-Carlton has been using and filed the trademark application for LI SI KA ER DUN in Chinese as the Chinese equivalent of RITZ-CARLTON. Thus, LI SI KA ER DUN in Chinese shall be deemed as the translation of RITZ-CARLTON.

4. New evidence accepted by courts

The Courts held that new evidence subsequently submitted by Ritz-Carlton hotel in the litigation is admissible. For practice in China, this issue is hotly debated and whether the Court will admit the new evidence varies from case to case. In this case, the court ruling and the presiding judge’s comments point out the essence and key factor to be considered.

The presiding judge comments and analyzes are as follows: There are different views between the TRAB and the Court as to whether the Cited Mark RITZ-CARLTON should be recognized as a well-known mark. The direct reason for this issue is the large amount of evidence supplemented by Ritz-Carlton hotel during the administrative litigation proceeding. Usually, in the administrative litigation proceeding, the Court does not necessarily admits all the evidence subsequently supplemented by the parties during the litigation proceeding. In this case, however, the evidence supplemented by Ritz-Carlton hotel is to strengthen the evidence submitted during the TRAB proceeding. It would seriously affect Ritz-Carlton hotel’s rights and interests if these evidence were not to be admitted, especially when comprehensively considering the evidence submitted during the TRAB proceeding and litigation proceeding, the RITZ-CARLTON mark may be recognized as a well-known mark. It would probably violate the principle of fairness and justice if the supplemented evidence were not admitted.