Weekly China Trademark News Updates

September 27, 2022

1. Using “HUAWEI” as a search keyword for products is considered as trademark infringement

Recently, the Shenzhen Futian District Court rendered a first-instance judgment on a trademark infringement dispute between Huawei Technologies Co., Ltd. (“Huawei”) and Shenzhen Mingyu United Technology Co., Ltd. (Mingyu United), and ordered Mingyu United to compensate Huawei for economic losses of RMB500,000 (USD69,000) and reasonable expenses of RMB1,069.8 (USD140).

Huawei obtained the exclusive right to use the registered trademarks “Huawei in Chinese” and “,” and was approved to use them on Class 9 for headphones and other goods. The said trademarks are still valid.

In this case, the accused infringing product is the same kind of product as those under Huawei’s registered trademark. The defendant set “Huawei in Chinese” as a search keyword and used the word “Huawei in Chinese” in its product name. “Huawei in Chinese” constitutes the same trademark as the Huawei’s registered trademark. Mingyu United used a graphic logo as the displayed picture. The graphic logo and Huawei’s registered trademark are both composed of the upper part of petals design and the lower part of English letters. The design parts on both marks are all in the shape of petals, and the overall visual effect is the same; the English letters “IEWAUH” are the same as Huawei’s. The English letters of the registered trademark “HUAWEI” have the same letter composition in reverse order. From an overall point of view, Mingyu United’s graphic logo is similar to Huawei’s registered trademark.

The search keyword “Huawei in Chinese” set by Mingyu United, the word “Huawei in Chinese” and the design logo used on the sales page of the accused infringing product have the function of identifying the source of the product and are trademark uses. Although Mingyu United indicated that the brand was SCOLIB in product details, and that the accused infringing product did not have the word “Huawei in Chinese” or a design logo, it set “Huawei in Chinese” as a search keyword and used “applicable to Huawei” and “original and genuine Huawei headphones,” in the product details, used design logos on the displayed photos, and labeled “Huawei in CHinese” in the product name and model details. These acts obviously showed the bad faith intention of takingadvantage of Huawei’s reputation, and it is very likely for the relevant public to believe that Mingyu United’s headphone is related to Huawei’s or that they have specific connections, which would cause confusion to the relevant public.

In summary, Mingyu United’s behavior of setting “Huawei” as a search keyword, using the word “Huawei in Chiness” in the product name, and using the design logo on the displayed photo infringed Huawei’s exclusive right to use its registered trademark, and should immediately stop the infringement and compensate for losses according to civil liabilities.

2. A company infringed Universal’s trademark by using the “Universal Studios in Chinese” mark without authorization

Universal City Studios LLC (also known as Universal Pictures Co., Ltd.) submitted a request to stop trademark infringement to the Beijing Tongzhou District Market Supervision Bureau (Tongzhou Supervision Bureau), requesting that the party’s use of the words “Universal Studios in Chinese” in the name of the hotel without the authorization of Universal constitutes trademark infringement.

On April 14, 2021, the Tongzhou Supervision Bureau came to a hotel franchise store based on clues provided by the trademark owner. After investigation, the party involved use the words “a hotel in Beijing Tongzhou Universal Studios” on electronic display screens, business cards, check-in receipts, temperature-measuring robots, health treasure QR code cards, hotel operation systems, and WeChat public account mini-programs in the hotel lobby without the authorization of the “Universal Studios in Chinese” trademark owner. The same words were also used on online platforms such as Ctrip, Dianping, Fliggy, Qunar, and eLong. As of the on-site inspection on April 14, 2021, the total operating revenue is RMB5.15 million (USD719,600).

The Tongzhou Supervision Bureau found that the above-mentioned behavior constituted trademark infringement, and ordered the party to stop the infringement immediately. In view of the party’s active cooperation and truthful account of the illegal facts and the initiative to provide evidence materials, immediate rectification was made at the scene, and at the same time considering that Universal Studios has not yet opened, the party’s infringement has limited impact on Universal Studios, the party was given a lighter punishment and imposed of an administrative penalty of RMB100,000 (USD13,900).

3. The CNIPA issued the “Notice on Comprehensively Implementing Online Applications for Rejection Appeal Cases” and “Interim Work Measures to Further Increase Trademark Opposition, Review, and Three-Year Non-use Cancellation Online Applications Filings”

Starting from November 1, 2022, trademark agencies should, in principle, submit electronic applications through the online trademark service system, and no longer submit paper materials.

In order to quickly and significantly increase online trademark opposition, review, three-year non-use cancellation filings. The CNIPA formulated and published Q&As guidelines for opposition, invalidation review, and three-year non-use cancellation, which aims to effectively guide applicants and trademark agencies to better use the online application system, deepen understandings, and improve efficiency.

In the next step, the CNIPA will further speed up the process of fully move trademark applications and responses electronically.

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Weekly China Trademark News Updates

September 20, 2022

1. Unauthorized use of the exact same design as a Royal Oak watch constitutes trademark infringement and unfair competition, and RMB 1 million in damages

Recently, the Shenzhen Intermediate Court has rendered a judgment for Audemars Piguet Holding S.A. (“Audemars Piguet”) against Hengbo Zhang in a trademark infringement and unfair competition dispute. The court found that the defendants’ acts constituted trademark infringement and unfair competition, and ordered the defendants to compensate the plaintiff for economic losses and reasonable expenses of RMB 1 million (USD142,720).

Cited Marks

Audemars Piguet manufactures, promotes, and sells self-branded watches. It launched the “Royal Oak” watch model in 1972. Audemars Piguet registered the “Royal Oak” trademarks (“Cited Marks”) on February 17, 1992 and September 12, 2016, respectively. The said trademarks were approved for use on goods in Class 14 for watches and jewelry. Audemars Piguet claimed that the defendant used a stylized “Royal One” logo (“Disputed Mark”) on a watch. When comparing the two, it can be clearly noticed that the similarity of the designs between the two. At the same time, the defendant’s watch copied the unique design features of the plaintiff’s “Royal Oak” and “Royal Oak Offshore” series of watches, including but not limited to the watches sold by the defendant under the name of “DIDUN DESIGN” that highly replicated the “Royal Oak” “Royal Oak Off Shore” series watch owned by Audemars Piguet.

The court found that the accused infringing goods were watches which were identical to the approved goods under the plaintiff’s Cited Marks. Compared with the Cited Marks, the logo “Royal One” on the accused infringing goods has a similar overall visual effect. In addition, compared with the plaintiff’s “Royal Oak” trademark, the artistic expression, visual effect and conceptual design of the “Royal One” logo on the alleged infringing goods were identical. In summary, the alleged infringing logo was similar to the Cited Marks, which may easily lead consumers into mistakenly believing that the goods sold under the infringer’s trademark originated from the plaintiff or that there was some connection between them, which constituted trademark infringement. Regarding unfair competition, Royal Oak and Royal Oak Offshore watches are well-known in the watch industry. The dial design of Royal Oak watches is very unique, which is different from ordinary watches. The shape has the function of distinguishing the source of the goods. The defendant used the exact same design as the Royal Oak watch without authorization, with the purpose of taking advantage of the goodwill of the Royal Oak watch, causing confusion or misleading of the relevant public. The defendant violated the principle of good faith and constituted an act of unfair competition as stipulated in Article 6(1) of the Anti-Unfair Competition Law.

2. A new round of amendments to the Trademark Law and its implementing regulations intend to clarify the civil liability for damages caused by bad faith squatting

A new round of preparations for the revision of the Trademark Law and its implementing regulations will pay more attention to the protection of rights and public interests, social effects, and balance of rights first, clarify the boundaries of the exercise of rights, solve the problem of insufficient maintenance of public interests, and promote a reasonable balance of rights and obligations. First, by strengthening the construction of integrity in the trademark fields, emphasizing that no deception or other improper means should be used to apply for or obtain trademark registration; study and clarify the liability for providing false materials; strengthen credit supervision and credit punishment. Second, to further regulate bad faith  trademark registrations, and to study effective regulations by increasing the amount of fines, clarifying the civil compensation liability for losses caused to others by bad faith squatting, establishing a system for assigning bad faith squatted trademarks, improving prohibition rules for trademarks containing geographical names, and other measures to curb bad faith trademark registrations. Third, to regulate the exercise of rights, prevent abuse of rights, and clarify the boundaries of the exercise of the exclusive right to use a trademark. It is proposed to stipulate that registered trademarks may be revoked for the improper exercise of the exclusive right to use a trademark. The introduction of a bad faith litigation counter-compensation system is under research. Fourth, to strengthen the social nature of trademark examination and trial work, and plan to set up a discretionary procedure for revocation of preliminary publication. Fifth, to strengthen the supervision and management of the trademark agency industry, clarify the access requirements for the trademark agency industry, and standardize the trademark agency behavior.

Continue to strengthen the obligation to use trademarks, make up for its shortcomings on the basis of adhering to the existing registration system, and focus on solving the problem of “emphasizing registration and neglecting use.” First, improving the concept of trademark use and highlight the basic status of use. Second, on the basis of retaining the non-use cancellation system, study the feasibility of introducing a trademark use commitment and active submission of use during its registration. Third, adding regulations on revocation of trademarks ex officio. If the trademark registrant fails to fulfill the promise of use, fails to submit a description of the use according to law, or improperly exercises the exclusive right to use the trademark, the registered trademark can be revoked ex officio.

3. Alibaba Technology (Beijing) Co., Ltd. was fined for representing Eileen Gu’s trademark

On September 6, 2022, the Beijing Market Supervision Bureau issued an administrative penalty decision of Jingshi Jian Punishment [2022] No. 181 against Alibaba Technology (Beijing) Co., Ltd. to represent the trademarks “Gu Ailing in Chinese” and “EILEEN GU.” The penalty decision held that Alibaba represented the two applicants for a total of 4 trademarks in the “Gu Ailing in Chinese” and “EILEEN GU” trademarks in June 2019 and February 2020, which violated the provisions of Paragraph 3 Article 19, and Article 32 of the Trademark Law. A warning and a fine of RMB 80,000 (USD11,400) was issued.

The provisions of Paragraph 3, Article 19 and Article 32 of the Trademark Law stipulates that it is illegal when agency knowingly or should have known that its client filed trademarks that infringes others’ prior rights, but still accepts the entrustment. The Beijing Market Supervision Bureau believes that as a public figure and Olympic champion, Eileen Gu’s name itself has a certain influence and attraction and has an “endorsement” effect. If her name is registered as a trademark without authorization, this will not only infringe Eileen Gu’s name right, but will also infringe on the prior rights and interests of others, and easily affect their good public image. Therefore, anyone’s registration of “Gu Ailing in Chinese” and “EILEENGU” should abide by relevant laws and regulations. As a trademark registration agency, the party concerned knew or should have known about the content, but still accepted to act as the applicants’ entrusted agency to register and apply for the “Gu Ailing in Chinese” and “EILEEN GU” trademarks, which damaged Eileen Gu’s prior rights and caused adverse social impact.

Follow us on LinkedIn! Email: trademark@beijingeastip.com Tel: +86 10 8518 9318 | Fax: +86 10 8518 9338 Address: Suite 1601, Tower E2, Oriental Plaza, 1 East Chang An Ave., Dongcheng Dist., Beijing, 100738, P.R. China