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Tackling Bad Faith Trademark Applications or Registrations in China – Part I
In this series, we are going to share our insights on how to best deal with bad faith trademark applications, a constant headache for foreign brand owners due to China’s first-to-file system. We will begin with the relevant stipulations in the Chinese Trademark Law of China (2019 Version) (“Trademark Law 2019”), the required factors when applying the laws, the current trend in tackling bad faith trademark applications or registrations, and finally demonstrate how to tackle the bad faith trademark applications or registrations with our successful cases.
1. Overview of the relevant stipulations in the Trademark Law 2019
We will start with an overview of the relevant portions of the provisions in the Trademark Law 2019.
A malicious application for trademark registration not filed for the purpose of using the trademark shall be refused.
The good faith principle shall be upheld in the application for trademark registration and in the use of trademarks.
A registered trademark shall be declared invalid by the Trademark Office if […] its registration is obtained by fraudulent or other improper means. Other entities or individuals may request the Trademark Review and Adjudication Board to declare the aforesaid registered trademark invalid.
These are the key articles that shall be applied when the CNIPA (“China National Intellectual Property Administration,” formerly the Trademark Office and Trademark Review and Adjudication Board) and the courts (Beijing Intellectual Property Court and Beijing High People’s Court) establish a bad faith case. Typically, at the opposition stage, examiners tend to apply Articles 7, while Article 44.1 is commonly invoked in invalidation actions; and we expect to see more application of Article 4 after the amendment of the Trademark Law 2019 that explicitly added the requirement of “intention to use” for filing trademark applications. Different from the CNIPA, the courts tend to apply Article 44.1 not only to invalidate registered trademarks, but also against applications pending in opposition proceedings. In recent years, there has been an increasing reliance on Article 44.1 in cases where the applicant squatted quite a number of others’ famous marks.
2. The required factors when applying the bad faith clause
Following the relevant laws regarding bad faith trademark applications and registrations, we will move onto the required factors when applying the bad faith clause.
First, the Beijing High People’s Court Guidelines for the Trial of Trademark Right Granting and Verification Cases specify what constitutes a bad faith application without intent to use provided in Article 4 and “other improper means” provided in Article 44.1 of the Trademark Law 2019.
Section 7.1 - Application of Article 4 of the Trademark Law
If any trademark applicant obviously lacks the true intent to use and falls into any of the following circumstances, this applicant may be determined to violate the provisions of Article 4 of the Trademark Law 2019:
(1) applying for registration of the trademark identical with or similar to that of various subject with certain popularity or higher distinctiveness, which is regarded as a serious circumstance;
(2) applying for registration of the trademark identical with or similar to that of the same subject with certain popularity or higher distinctiveness, which is regarded as a serious circumstance;
(3) applying for registration of the trademark identical with or similar to any other commercial signs other than trademarks of others, which is regarded as a serious circumstance;
(4) applying for registration of the trademark identical with or similar to any name of place, scenic spot, building and others with certain popularity, which is regarded as a serious circumstance; or
(5) applying for registration of a large number of trademarks without good reasons. If the trademark applicant above claims that he has the true intention of use, but fails to present the relevant evidence, this claim shall not be supported.
Section 17.3 - Determination of specific circumstances of “other improper means” relating to the application of article 44 of the Trademark Law 2019
A trademark under any of the following circumstances may be determined to fall under the circumstances that “the registration is obtained by other improper means” provided in Article 44.1 of the Trademark Law 2019:
(1) the trademark applicant in dispute applies for multiple trademark registrations which are identical with or similar to others’ trademarks with higher distinctiveness or popularity, including the application for trademark registrations of different owners on identical or similar goods or services and also the application for trademark registrations of the same owner on non-identical or dissimilar goods or services;
(2) the trademark applicant in dispute applies for multiple trademark registrations which are identical with or similar to any other corporate names, names of social organization, the names, packaging, decoration and commercial signs of goods with certain influence; or
(3) the trademark applicant in dispute sells the trademark, or file an infringement lawsuit against the users of the prior trademark after failing to transfer at a high price.
The guidelines explicitly provides that bad faith will be inferred where a squatter targets different trademarks belonging to a particular trademark owner. This will significantly improve the applicability of Article 44.1 and turn it into a powerful weapon against those “sophisticated” squatters who copy various trademarks owned by a particular trademark owner instead of different owners.
Second, the State Administration for Market Regulation also published Several Provisions for Regulating Applications for Trademark Registration, which set parameters for determining bad faith practices and bad faith applications for trademarks that are not intended for use, such as number of trademarks applied, classes of trademarks applied, transaction records of trademarks, business operation of the applicant, effective rulings on infringement or bad faith registration, and among other things.
To sum up, if the owner or applicant of a target mark fits any or all of the below circumstances, it is recommended that brand owners considering taking actions safeguarding valuable intellectual property assets.
Note, however, among the said circumstances, there is not yet a definition for “a large number” or “severe circumstances.”
In practice, we find that when performing a comprehensive assessment in establishing bad faith, some interdependence among the said relevant factors usually occur. For instances, a relatively small number of trademark filings may be offset by 1) a greater degree of earlier marks’ distinctiveness, 2) a greater degree of the proprietaries’ fame; 3) a closer distance of two parties’ domicile, 4) a closer relatedness of the two parties’ lines of business, 5) a higher level of association of the professionalism of the designated goods or services, etc.
Further, the CNIPA published in March 2021 the Notice on Special Initiative on Cracking Down on Malicious Trademark Squatting ("Notice"), which states that the CNIPA is striving to combat the seven circumstances of malicious trademark squatting which aim at obtaining improper interests, disturbing the trademark administration order, and causing detrimental social impacts. One of the methods to reject bad faith applications is adopting a “fast rejection mechanism” when there are suggestive indications that the applications was filed in bad faith during the trademark application process. Likewise, during oppositions and cancellations, if there are suggestive indications of bad faith, these cases would be prioritize or joined for expedited examination to reject or invalidate those marks.
The Notice shows the CNIPA’s firm standpoint to combat squatting, and from the recent opposition and invalidation decisions, we see a trend in compliance with such determination.
While we will share CNIPA decisions and court judgments applying the bad faith clauses, we set here some drops in the bucket. Spoiler alert!
Enough for this week, follow us and stay tuned for more cases in the upcoming issues!
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Well-Known Mark Recognitions in China – Part IV
In Part III of this series, we selected our representative cases to further illustrate how the courts apply well-known mark recognition and extend the scope of protection for a well-known mark. In Part IV, the finale of our well-known mark recognition in China, we would like to share with you our insights on how to collect evidence for well-known mark recognition for goods and service in the software and internet industry. Collecting evidence for intangible items is already demanding. Collecting evidence for intangible items for well-known recognition is even more challenging but possible.
1. “PHOTOSHOP” v. “photoshop”
Beijing Liantuochuangxiang Technology Development Co., Ltd. (“Liantuo”) applied for the “photoshop” mark (“Disputed Mark”) with App. No. 9329485 in Class 3 for “lipstick; nail polish; cosmetics; cosmetic pens; eyebrow cosmetics; perfume; eyebrow pencil; rouge; eye shadow cream; dyed lash oil” on April 12, 2011.
|Disputed Mark||Cited Mark|
Adobe owns a prior registration for the “PHOTOSHOP” mark (“Cited Mark”) with App. No. 573256 in Class 9 for “computer program.”
Adobe filed an opposition against the Disputed Mark on April 20, 2012 before the CNIPA. The CNIPA rendered a decision allowing the Disputed Mark to be registered. Unsatisfied, Adobe appealed but the CNIPA affirmed the Disputed Mark’s registration. Adobe filed an administrative appeal against the CNIPA before the Beijing First Intermediate Court. The court rejected Adobe’s appeal against the CNIPA. Adobe appealed to the Beijing High Court which, finally, ruled in favor of Adobe and ordered the CNIPA to reissue its decision.
In this case, the Beijing High Court found that Adobe submitted sufficient evidence in proving the Cited Mark enjoyed high fame through long-term and extensive promotion and use. For example, thousands of media reports from the People’s Daily, Guanming Daily, China Computer News, Computer World, etc. were submitted as evidence proving the Cited Mark enjoyed high fame. Adobe also submitted the various awards “PHOTOSHOP” received, such as “Computer World’s Annual Product Award” and “Milestone Product of China Information Industry 20 Years Award.” Adobe provided records of its annual certificate examination for “National Computer Application Technical Certificate for Photoshop 6.0” since 2001, as well as the number of “PHOTOSHOP” downloads from the Internet. Given the above, the court held that Adobe’s evidence met the criteria to recognize the “PHOTOSHOP” mark as a well-known mark.
Considering that the Cited Mark had strong inherent distinctiveness and the Disputed Mark was identical to the Cited Mark, the court found that the Disputed Mark was a copy of the Cited Mark. Although the Disputed Mark’s designated goods for “lipstick” had certain variance with the Cited Mark’s approved goods for “computer program,” the relevant consumers for the two marks would still overlap. After comprehensively considering the above analysis, namely, the Cited Mark had inherent distinctiveness, enjoyed high fame, the two marks were identical, the court concluded that the Disputed Mark’s designated goods for “lipstick” was likely to weaken the close association between the Cited Mark and its approved goods for “computer program,” dilute the Cited Mark’s distinctiveness, and damage Adobe’s interests.
2. “Mei Tu Xiu Xiu and MEITUXIUXIU” v. “Mei Tu Xiu Xiu”
An individual Rongxiong BEI applied for the “Mei Tu Xiu Xiu and MEITUXIUXIU” mark (“Disputed Mark”) on April 19, 2013 with App. No. 12454059 in Class 3 for “detergent; grinding paste; rose oil; toothpaste; dried petal and perfume mixture (perfume); animal cosmetics; air fragrance; cosmetics; shampoo; shoe polish,” and the Disputed Mark was approved for registration on September 28, 2014.
|Disputed Mark||Cited Mark|
Xiamen Meitu Technology Co. (“Meitu”) applied for the “Mei Tu Xiu Xiu” mark (“Cited Mark”) on December 8, 2008 with App. No. 7099841 in Class 9 for “optical disk; information processor (central processing unit); computer software (recorded); electronic dictionary; recorded computer program (program); computer; computer program (downloadable software); network communication equipment; electronic sound device with books; magnetic data medium,” and was approved for registration on October 14, 2010.
Meitu filed an invalidation against the Disputed Mark with the CNIPA on July 24, 2015. Upon adjudication, the CNIPA held that the Disputed Mark shall be invalidated. BEI appealed to the Beijing IP Court. The Beijing IP Court rejected BEI’s appeal. BEI then appealed to the Beijing High Court. The Beijing High Court affirmed the CNIPA’s decision and ruled in favor of Meitu. BEI, still unsatisfied, petitioned to the Supreme People’s Court for retrial but the petition was rejected.
In its decision, the Beijing High Court found that prior to the Disputed Mark’s application date, the Cited Mark had occupied a rather large market share and covered wide range of regions for sales through long-term, extensive, and continued promotion and use on its approved goods for “computer software (recorded), recorded computer program (program), computer, etc.” The Cited Mark constituted as a well-known mark because it had been known to the relevant public and enjoyed high fame.
The court reasoned the Cited Mark consisted of four Chinese characters “Mei Tu Xiu Xiu” that did not have particular meaning and had inherent distinctiveness. The Disputed Mark was a copy and imitation of the Cited Mark because the Disputed Mark’s distinctive part was identical with the Cited Mark. Although the two marks designated goods in difference classes, the relevant consumers and target consumers overlapped. Considering the Cited Mark was a well-known mark and that the Disputed Mark’s distinctive part was identical to the Cited Mark, the relevant consumers were likely to be confused regarding the relationship between the two marks when purchasing the Disputed Mark’s designated goods. Such confusion would weaken the Cited Mark’s distinctiveness, unfairly exploit the Cited Mark’s market reputation, and damage the Cited Mark and Meitu’s interests.
3. Beijing East IP analysis and comments
As you may have reckoned, the photoshop and Mei Tu Xiu Xiu cases shared some similarity in that the courts recognized both cited marks as well-known marks on computer program related goods and gave cross-class protection against lipsticks and cosmetic related goods. The two focal points in these two cases are: 1) evidence collection for obtaining well-known mark recognition in connection with software application related goods, and 2) the association between disputed mark’s designated goods or services and cited mark’s approved goods or services.
a. Evidence collection for obtaining well-known mark recognition mark designating software related goods
It is important to note not to apply Article 14 of the Chinese Trademark Law verbatim when collecting evidence for well-known mark recognition. Instead, consider utilizing relevant public’s understanding and recognitions on the marks and the goods involved. In the photoshop case, we supplemented large amount of evidence in the second instance trial to prove that the cited mark had reached well-known status prior to the disputed mark’s application date, including media reports, awards, rankings, sales records, Chinese brochures, China subsidiaries information, China and worldwide judicial and administrative adjudications, to name a few. Since Photoshop is a software, we particularly emphasized Photoshop’s versions, downloads, and user numbers, as well as other facts reflecting that Photoshop is now included in national certificate examinations, included as part of national computer examination, and used as teaching materials. We argued that Photoshop can be considered as well-known because it is included in the national computer application certificate examination and numerous people had taken such exam. Compared to foreign entities, domestic entities such as Meitu tend to have the up hand in collecting evidence originated from China. However, it is more challenging for internet companies than traditional companies collecting evidence for well-known mark recognitions considering the evidence are often intangible. When collecting evidence for Meitu’s cited mark, we collected large amount of use evidence, number of users, product sales records, promotional and advertisement records, and awards received to prove that the cited mark satisfied the well-known mark recognition threshold. For example, for use evidence, evidence of earliest use and software product update records were presented. For product sales records, revenue, profit, tax, sales agreements, collaborators, and regions that products bearing the cited mark covered were presented. Other evidence such as commercial and promotional agreements, fees, media reports, and the actual awards received were submitted as evidence proving the cited mark has reached well-known status. The second instance court found that although Meitu’s profit between 2010 and 2013 was relatively low, profit was merely one of the many factors in determining the cited mark’s well-known status and fame. When determining whether a mark reached well-known status, the focus should be laid on the distinctiveness and well-known status of the cited mark on the approved goods, as well as the internet industry’s operation features, namely, software development and market promotion related investment would likely exceed profit at the beginning.
b. The association between disputed mark’s designated goods or services and cited mark’s approved goods or services
Often, it is difficult to prove the association between disputed mark’s designated goods or services and cited mark’s approved goods or services, especially when these goods or services are in different classes. For example, in the photoshop case, we submitted online media reporting that the approved goods, software, for Adobe’s “PHOTOSHOP” mark can provide various beautify functions and use visual aids during trial to detail how the relevant public use cosmetics prior to taking photos, and subsequently edit photos using the PHOTOSHOP software for beautify purposes to create better photos or pictures presentations. We argued that the disputed mark’s designated goods for “cosmetics” and the cited mark’s approved goods for “software” all carried the functions of beautify human’s faces or images. Thus, the target consumers overlapped and are closely related. Combining the above evidence with the “PHOTOSHOP” mark’s distinctiveness and fame, we further argued that the disputed mark’s registration and use would weaken the one-to-one and unique association between Photoshop and Adobe, dilute the distinctiveness of the well-known “PHOTOSHOP” mark, and damage Adobe’s interests.
Thank you for tuning in to our well-known mark recognition series. If you have any questions, please feel free to contact us.
Next, we will share our experience and insights regarding bad faith trademark registration and how to counter trademark squatting. We selected this topic because China’s first-to-file system can be difficult to navigate for foreign stakeholders who may not always have the need to apply for trademarks in China when they first start their businesses outside of China.
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Well-Known Mark Recognitions in China – Part III
In Part II of this series, we shared our representative cases on how to apply the concept of anti-dilution for the protection of a well-known trademark in administrative trademark litigations. In Part III, we selected our representative cases to further illustrate how the courts apply well-known mark recognition and extend the scope of protection for a well-known mark.
1. RITZ-CARLTON v. "LI SI KA ER DUN in Chinese"
Chengdu Zhi Zhi Real Estate Development Co., Ltd. (“Zhi Zhi”) applied for the “LI SI KA ER DUN in Chinese (丽思卡尔顿)” mark (“Disputed Mark”) with App. No. 5336988 in Class 36 for “commercial housing sales services; insurance; capital investment; art valuation; real estate agency; agency; guarantee; raise charitable funds; entrusted management; pawn shop” on May 9, 2006. The Disputed Mark was approved for registration on October 14, 2009.
|Disputed Mark||Cited Mark 1||Cited Mark 2|
Ritz-Carlton owns prior registrations for the “RITZ-CARLTON” mark (“Cited Mark 1”) and the “LI SI KA ER DUN in Chinese (丽思卡尔顿)” mark (“Cited Mark 2”) in Class 42 (Class 43) for “hotels; restaurants; barbeque restaurants; tea rooms; etc.”
Ritz-Carlton filed a dispute cancellation against the Disputed Mark on March 28, 2010 before the CNIPA (then the Trademark Review and Adjudication Board). The CNIPA issued a decision that maintained the Disputed Mark’s validity on August 29, 2011. Unsatisfied, Ritz-Carlton appealed to the Beijing First Intermediate Court.
On December 20, 2012, the Beijing First Intermediate Court reversed the CNIPA’s decision. Zhi Zhi was unsatisfied and appealed to the Beijing High Court. On July 31, 2013, the Beijing High Court, as the second instance court, issued the final decision that affirmed the Beijing First Intermediate Court’s decision against Zhi Zhi.
In this case, the Beijing High Court found that the Disputed Mark consisted of “LI SI KA ER DUN in Chinese (丽思卡尔顿)” and before the Disputed Mark’s application date, media and the Internet had widely adapted and used “LI SI KA ER DUN in Chinese (丽思卡尔顿)” to refer to RITZ-CARLTON. Ritz-Carlton submitted sufficient evidence during the administrative and judicial proceedings to prove that they had received great businesses in the hotel industry, received numerous awards, and attracted high levels of media’s attention before the Disputed Mark’s application date. Namely, before the Disputed Mark’s application date, “LI SI KA ER DUN in Chinese (丽思卡尔顿)” could often be seen on various newspapers and the Internet, and such constant media reports subjectively expanded the societal influence of the “LI SI KA ER DUN in Chinese (丽思卡尔顿)” brand, allowed Ritz-Carlton to enjoy high fame among the relevant public in China. Thus, the Disputed Mark constituted as a translation of “RITZ-CARLTON.” Consider the “RITZ-CARLTON” mark obtained relative high fame on hotel related services through uses and promotions, and the Disputed Mark’s approved services for “sales services for commercial real estate and real estate agency” were related to the hotel services, the Disputed Mark’s registration was likely to cause confusion to the public and damage Ritz-Carlton’s interests. The Beijing First Intermediate Court correctly recognized the “RITZ-CARLTON” mark as a well-known mark, based on the evidence submitted, to protect Ritz-Carlton’s trademark rights according to Article 13(2) of the 2001 Chinese Trademark Law (“TM Law”) (Article 13(3) of the 2019 TM Law).
2. “YAHOO!” v. “YahaoSoft”
Beijing Jing San Pu Business Trading Co., Ltd. (“Jing San Pu”) applied for the “YaohaoSoft” mark (“Disputed Mark”) with App. No. 3610948 in Class 42 for “intellectual property supervision; computer leasing; computer programming; computer software coding; computer software maintenance; creation and maintenance of websites for others; hosting computer stations (websites); computer hardware consulting” on June 30, 2003. The Disputed Mark was published for opposition on May 28, 2005.
|Disputed Mark||Cited Mark|
Yahoo! owns prior registrations for the “YAHOO!” mark (“Cited Mark”) in Class 42 for “computer service; namely: to query and retrieve the information used on the computer network.”
Yahoo! filed an opposition against the Disputed Mark with the CNIPA on December 1, 2009 and the CNIPA refused the Disputed Mark for registration. Jing San Pu appealed to the Beijing First Intermediate Court. Yahoo! attended the hearing as a third-party attendee. The Beijing First Intermediate Court affirmed the CNIPA’s decision.
In its decision, the Beijing First Intermediate court found that except intellectual property supervision, all other services such as computer leasing, computer programming, etc. were similar to the Cited Mark’s approved services “computer service; namely: to query and retrieve the information used on the computer network.” The “Soft” of the “YahaoSoft” can be understood meaning “software” when used on computer related services, which had weak distinctiveness, and the “Yahao” part was the distinctive part of the Disputed Mark. When compared the Disputed Mark’s distinctive part “Yahao” with the Cited Mark “YAHOO!,” it was obvious that the font and pronunciation were similar. If both marks were to co-exist on identical or similar services, it was likely to cause relevant consumer to be confused or mistaken on the source of services. Thus, the Disputed Mark constituted a similar mark with the Cited Mark according to Article 28 of the 2001 TM Law (Article 30 of the 2019 TM Law).
Yahoo! submitted sufficient evidence during the administrative proceeding to prove that Yahoo! had been using its English trade name “YAHOO!” for computer network related services prior to the Disputed Mark’s application date. Yahoo!’s trade name had attracted market reputation from the relevant public through use. There were strong associations between the computer network related services provided by Yahoo! and the Disputed Mark’s designated services of computer leasing, computer software coding, etc. Accordingly, when the Disputed Mark was registered on the said designated services, the relevant public was likely to be confused as to the source of services and Yahoo’s prior trade name right would be damaged according to Article 31 of the 2001 TM Law (Article 32 of the 2019 TM Law).
The evidence Yahoo! submitted during the administrative proceeding proved it had attracted market reputation before the Disputed Mark’s application date on computer related services, namely, to query and retrieve the information used on the computer network. Combined with the fact that the Disputed Mark’s main distinguishable part was similar to the Cited Mark in font and pronunciation, which constituted as the Cited Mark’s imitation. Although the intellectual property supervision services designated under the Disputed Mark was not similar to the computer services designated under the Cited Mark, given that the Cited Mark had reached well-known status, the Disputed Mark’s use on the said services would likely to cause the relevant public to mistaken that the Disputed Mark had certain association with the Cited Mark, and potentially damage the Cited Mark owner’s interests according to Article 13(2)of the 2001 TM Law (Article 13(3) of the 2019 TM Law).
3. Beijing East IP analysis and comments
In Part I of this series we mentioned that a mark can be recognized as well-known based on the principles of case-by-case recognition and need-based recognition. The main issue presented in the two cases is when and how to apply well-known mark recognition in each case.
First, in the RITZ-CARLTON case, Ritz-Carlton based its grounds on Article 10(1)(viii), Article 13(2), Article 31, and Article 41(1) of the 2001 TM Law. The court found that the Disputed Mark’s registration does not fall into the conditions described in Article 10(1)(viii), Article 31, Article 41(1). The court only applied Article 13(2) in finding that Zhi Zhi’s trademark registration in Class 36 would damage Ritz-Carlton’s well-known mark in Class 42 (Class 43). Here, although Ritz-Carlton based its grounds on four different articles, the court held that the articles other than Article 13(2) did not apply, and that it was necessary to recognize the cited mark as a well-known mark to protect Ritz-Carlton’s trademark rights.
In the YAHOO! case, Yahoo! based its grounds on Article 13(2), Article 28, and Article 31 of the 2001 TM Law. The court applied Article 28 in finding that the Disputed Mark constituted as a similar mark to the Cited Mark when used on similar services. The court also applied Article 31 in finding that the Disputed Mark’s registration on services similar to those services approved under the Cited Mark would damage Yahoo!’s prior trade name right. Here, since the court had applied Article 28 and Article 31 in protecting Yahoo!’s rights against the designated services on computer related services under the Disputed Mark, the court did not apply Article 13(2) for cross-class protection regarding the computer related services. The court’s application of laws clearly demonstrated that when the interest party’s rights can be protected by certain articles raised in its argument, the court will not apply the article regarding well-known mark recognition.
Second, although well-known mark recognition provides cross-class protection, such protection only extends to the relevant goods or services covered by the level of the mark’s well-known status, that is, the cross-class protection does not extend to all 45 classes. In the RITZ-CARLTON case, the court recognized the “RITZ-CARLTON” mark was well-known in hotels services. The Disputed Mark’s approved goods on commercial housing sales services and real estate agency services were related to hotels services. Based on this finding, the court concluded that the Disputed Mark’s registration on the said services would be likely to cause confusion to the relevant public and damage Ritz-Carlton’s interests. The court, however, did not grant protection against other services (insurance; capital investment; art valuation; agency; guarantee; raise charitable funds; entrusted management; pawn shop) under the Disputed Mark. In the YAHOO! case, the court granted cross-class protection on the intellectual property supervision service based on Yahoo!’s arguments that, in the Internet industry, intellectual property supervision was closely related to Yahoo!’s well-known search engine related services and serves similar consumers.
Finally, the evidence we submitted on behalf of our clients during the administrative litigation proceedings was key in obtaining the well-known mark recognition. Generally, courts do not always admit new evidence in administrative litigation. In the RITZ-CARLTON case, the CNIPA and the courts have different views as to whether the “RITZ-CARLTON” mark could be recognized as a well-known mark. The difference lies in the admissibility of the large amount of new evidence submitted during the court proceeding. We collected and submitted copies of various evidence found through the National Library, the Shanghai Library, the China Tourism News, the People's Daily, Xinhua Net, CNKI and other media as corroborative evidence. Meanwhile, we further submitted the notarized documents as corroborative evidence to satisfy the formality requirement. The courts affirmed that the new evidence is to strengthen the evidence submitted during the CNIPA proceeding, in which Ritz-Carlton submitted substantial evidence to support its arguments. If not admitted, Ritz-Carlton’s rights would be severely damaged. Especially under the circumstance that when comprehensively consider all evidence submitted, the cited mark can be recognized as a well-known mark, not admitting the supplemental evidence would be unjustified.
As you may have guessed, evidence collection is an important phase in obtaining well-known mark recognition. Next, we will share different cases to further elaborate how to best collect evidence for a well-known mark.
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Well-Known Mark Recognitions in China – Part II
Previously, we shared our insights on how to secure well-known mark recognitions in China and its benefits. In the next few articles, we will be sharing cases with analysis on how the courts apply well-known mark recognitions to various facts.
1. “Cisco in Chinese” v. “SIKE and SI KE in Chinese”
Foshan City Shunde District Lunjiao Junze Electrical Appliance Factory (“Lunjiao”) applied for the Disputed Mark No. 13618667 on November 27, 2013 and was approved for registration on November 28, 2016 in Class 11 for “electric cooker; electric kettle; electric water heater; electric yogurt maker; electric pressure cooker (pressure cooker); gas stove; gas water heater.” Cisco applied for the Cited Mark No. 3999024 on April 6, 2004 and was approved for registration on September 7, 2006 in Class 9 for “network communication equipment; telephone; etc.”
|Disputed Mark||Cited Mark|
Cisco filed an invalidation request on February 27, 2017 before the CNIPA. The CNIPA affirmed the Disputed Mark’s validity. Cisco appealed the decision to the Beijing IP Court. On May 24, 2019, the Beijing IP Court reversed the CNIPA’s decision and ordered the CNIPA to re-render its decision based on the Beijing IP Court’s decision.
In its decision, the Beijing IP Court found that the evidence submitted by Cisco is sufficient to prove the well-known mark status of “CISCO in Chinese (思科)” on “network communication equipment” in Class 9 prior to the application date of the Disputed Mark. Further, the Beijing IP Court found that the Disputed Mark’s specific composition combining “SIKE” and “SI KE in Chinese (思科)” copied and imitated Cisco’s well-known mark. The Disputed Mark’s approved goods for “electric cooker; electric water heater; etc.” were common household consumer goods that were likely to attract relevant consumers who were attracted to the Cited Mark’s approved goods. Meanwhile, Lunjiao failed to provide reasonable explanations regarding the idea that shaped the Disputed Mark’s creation. Cisco’s evidence also showed that in addition to the Disputed Mark, Lunjiao applied for six other trademarks, one identical to the Disputed Mark and five “3M” marks, which inevitably suggested the likelihood of Lunjiao’s bad faith intention in free riding other’s goodwill. Similarly, the Disputed Mark’s relevant consumers were likely to associate Cisco’s well-known mark “Cisco in Chinese (思科)” upon seeing the identical Chinese characters used in the Disputed Mark. The Disputed Mark may also dilute the well-established corresponding relationship between Cisco and its well-known mark “Cisco in Chinese (思科),” impaire the distinctiveness of Cisco’s well-known mark, and damage Cisco’s well-known trademark rights.
2. “McFlurry in Chinese” v. “MAI XUAN FENG in Chinese”
China Top Foods Co., Limited (“Top Foods”) applied for the Disputed Mark No. 12049136 on January 15, 2013 and was approved for registration on November 28, 2015 in Class 35 for “advertisement promotion; advertising design; commercial management of franchising; marketing for others; personnel management consulting; business enterprise migration; compiling information into computer databases; accounting; vending machine rental; seeking sponsorship.” McDonald’s applied for the Cited Mark 1 No. 1646857 in Class 29 for “meat products; pork products” and Cited Mark 2 No. 8666342 in Class 30 for “ice cream, etc.” prior to the Disputed Mark’s application date.
|Disputed Mark||Cited Mark 1||Cited Mark 2|
McDonald’s filed an invalidation request on August 19, 2016 before the CNIPA. The CNIPA affirmed the Disputed Mark’s validity. McDonald’s appealed the decision to the Beijing IP Court. On August 1, 2019 the Beijing IP Court reversed the CNIPA’s decision and ordered the CNIPA to re-render its decision based on the Beijing IP Court’s decision.
In its decision, the Beijing IP Court found that the Cited Mark 1 and Cited Mark 2 (“Cited Marks”) could be recognized as well-known marks based on the evidence McDonald’s submitted. The evidence showed that prior to the Disputed Mark’s application date, McDonald’s carried out long-term, extensive, and numerous promotions for the Cited Marks “McFlurry in Chinese (麦旋风)” on milk products, ice cream, etc. in mainland China. The Chinese characters used in the Disputed Mark were identical to the Cited Mark 2. The only undiscernible difference between the Disputed Mark and the Cited Mark 1 was that the Disputed Mark used traditional Chinese and the Cited Mark 1 used simplified Chinese. Based on foregoing reasons, the Disputed Mark copied the Cited Marks. Moreover, because the Cited Marks had strong distinctiveness with high fame, even if the approved services “advertisement promotion, etc.” under the Disputed Mark were unrelated to the approved goods “milk” and “ice cream” under the Cited Marks, the relevant consumer would inevitably associate McDonald’s and its well-known marks upon seeing the Disputed Mark. Such association would damage the well-established correspondence between McDonald’s and the Cited Marks, decrease the distinctiveness of McDonald’s well-known mark, and damage McDonald’s interests.
3. Beijing East IP analysis and comments
The standard applied for well-known mark protection can be found in Article 9(2) of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Civil Dispute Cases Involving Well-Known Trademark Protection (“SPC Interpretation”) which states that associations that are capable of confusing the relevant public to believe that the accused trademark has a considerable degree of association with a well-known mark, thereby weakening the distinctiveness of that well-known mark, derogating the market reputation of that well-known mark, or improperly using the market reputation of that well-known mark. This standard shall be consistently applied across administrative and civil trademark litigations. The SPC Interpretation established that, instead of likelihood of confusion, courts shall focus on impairing a well-known mark’s distinctiveness, harming a well-known mark’s reputation, or improperly using a well-known mark’s market reputation when finding damage for a well-known mark. Such approach is aimed at protecting a well-known mark’s distinctiveness from impairment and preventing harm from the one-to-one association established between a well-known mark and its particular goods and services.
In judicial practice, when determining the scope of protection for a well-known mark, courts should comprehensively consider the well-known mark’s distinctiveness, fame, similarity between the marks, actual use of the approved goods, degree of overlapped relevant consumers and their attentions, and the subjective state of mind of the disputed mark’s applicant.
The Cisco and the McFlurry cases reflect how well-known mark protection extends the scope of protection in administrative trademark litigations to not only eliminate potential likelihood of confusion but also prevent well-known mark from dilution.
In this Cisco case, the disputed mark’s approved goods “electric stove; electric water heater, etc.” are common consumer goods that face a wide range of relevant public, which overlaps with the targeted consumer of Cisco’s approved goods “network communication equipment.” Considering Cisco’s cited mark “CISCO in Chinese (思科)” has strong distinctiveness and has established a close association with Cisco through long-term promotion and use. In recognizing Cisco’s cited mark as a well-known mark and granting cross-class protection, the court considered whether the disputed mark would break the one-to-one association and the well-established connection between Cisco’s famous network communication equipment and its cited mark, and whether the disputed mark would impair the cited mark’s distinctiveness. Similarly, in the McFlurry case, although the approved goods “advertisement promotion” for the disputed mark are not necessarily related to the approved goods “milk” and “ice cream” for the cited mark, the court applied the dilution principle when recognizing McDonald’s cited marks as well-known because of its relative high fame and granted the cited marks with additional protections. In other words, the scope of protection of a well-known mark shall match its degree of fame, namely, potentially expand its scope of protection.
Moreover, the subjective state of mind of the disputed mark’s applicant is also an important factor. In the Cisco case, Lunjiao failed to provide reasonable sources of its idea in creating the disputed mark. Together with the five “3M” marks Lunjiao applied, its bad faith in free riding other’s fame can hardly be ignored. In the McFlurry case, Top Foods applied “M MACCAS” marks in many Classes and its only shareholder applied for “Man Ji in Chinese (满记) (A famous desserts shop from Hong Kong),” “HILTON,” “Xin Zhou Kan in Chinese (新周刊) (A famous magazine in China), etc.” These trademark filings suggest bad faith in copying and imitating other’s highly famous trademarks.
Finally, when considering whether a mark shall be recognized as well-known, judicial and administrative authorities usually refer to Article 14 of the Trademark Law. Additionally, financial statistics are proven to be important supporting evidence for well-known mark recognition such as sales numbers, tax, audit report, etc. Foreign entities, however, may have difficulties in providing such information as supporting evidence. In helping our clients tackle such a challenge, we devote crucial time and efforts to find evidence from all angles and connect each piece of evidence found into a complete evidence chain. In building such evidence chain, we strive to find essential data and locate critical evidence five years prior to the disputed mark’s application date. Under the circumstances that the clients were unable to provide its sales number and market share data in China directly to us, we parsed through targeted online and offline media that reported the sales number and market share data in China, combining with rankings from authoritative magazines such as Fortune and Businessweek, published annual reports, and awards received to persuade the courts to recognize the well-known mark.
Next, we will continue to share different cases to showcase how well-known mark protection is done in China.
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Securing well-known mark (WKM) recognitions in China can give a broader protection to brand owners in both administrative and judicial disputes.
E-commerce Law and E-commerce Intellectual Property Protection Forum, which was sponsored by Beijing Municipal Intellectual Property Office and Beijing Higher People’s Court, and hosted by Beijing Intellectual Property Protection Association and the Intellectual Property Protection Alliance of E-Commerce, was successfully held on September 12, 2019 in Beijing.
Appointed Translators: Jason WANG / Austin CHANG, Beijing East IP Law Firm
Author: Baoqing ZANG, Trademark Review and Adjudication Board (TRAB)
Original Chinese text: China Industry and Commerce Newspaper June 21, 2016
On February 28, the Beijing IP Court (“IP Court”) issued a decision in Qilu Pharmaceutical v. the PRB ((2017)京73行初字No. 5365), which reversed a ruling by the Patent Reexamination Board (“PRB”) that upholds the validity of Patent No. 200910176994.1 (the “’994 patent”) owned by Beijing Sihuan Pharmaceutical (“Sihuan”). The IP Court holds that the inauthentic experimental data presented in the original description result in the failure to satisfy the enablement requirement.
China has three types of patents, i.e., invention, utility model, and design. The utility model patent does not have the counterpart in some other jurisdictions such as the USA, so some essential aspects of the utility model patent will be introduced below for better understanding of it.
On December 20, 2017, in the Patent Reexamination Board of SIPO (PRB) v. Beijing Winsunny Harmony Science & Technology Co., Ltd. ((2016)最高法行再41号), the Supreme Court held that a Markush claim, when drawn to a class of chemical compounds, should be interpreted as a set of Markush elements rather than a set of independent specific compounds. The present case is a petition for retrial filed by the PRB, requesting the Supreme Court to review the second-instance decision made by the Beijing High People’s Court (“High Court”). In reversing the PRB’s decision in the invalidation proceedings instituted by Beijing Winsunny Harmony Science & Technology Co., Ltd. (“Winsunny”), the High Court recognized a Markush claim as claiming a set of parallel technical solutions.
Abstract: Currently “common knowledge" has become a hot topic in academic research. How to correctly determine common knowledge has become the key to improve the quality of patent examination. This paper introduces the availability bias theory to point out that the common knowledge determining process tends to produce availability bias, give too much weight to the easily conceived technical knowledge, and turn a blind eye to a lot of other information that must be considered, leading to errors in determining common knowledge. In patent examination, the availability of parts, the availability of work methods and the availability of technical problems may lead to the availability bias. In the end, the countermeasures is put forward.
Just at the beginning of this year, the Patent Reexamination Board (PRB) of SIPO issued a decision in a notable patent invalidation trial against Novartis’s patent on Entresto (Sacubitril/Valsartan), holding all the claims of the patent invalid as being obvious.
The similarity criteria is always a focus of attention in determination of design infringement. Conventionally, people often discuss whether two designs are alike in determining design infringement without objective analysis standards.
For a service invention-creation, the right to apply for a patent belongs to the entity. After the application is allowed, the entity shall be the patentee. In these cases, the Supreme Court provided a method to determine whether an invention-creation in a patent application is a service invention.
The type of the infringement of making and selling a component patent that contains a patented component has been expressly determined, in the judicial interpretation published by the Supreme People’s Court in December 2009, as infringing actions of “using” and “selling” a patented component.
In patent infringement litigations, the right owner usually selects independent claim(s) with largest scope of protection for enforcement of the patent right. Senior patent attorney Bing Wu combines the SPC interpretations and his trial experiences to provide a brief guide on building a good foundation of selecting the rights claims is crucial for winning a patent infringement in China.
In its latest report the Supreme People's Court explains the new patent, trademark and copyright concepts explored through 2015's most complex and major IP disputes.
Article 25 of SPC'S Judicial Interpretation on Trial of Patent Infringment Dispute where products infringing a patent right are used, offered to sell, or sold for production or business purposes without knowing said products were manufactured and sold without the authorization of the patentee, and......
Article 14 of SPC'S Judicial Interpretation on Trial of Patent Infringment Dispute , the People’s Court, in determining the knowledge level and cognitive ability of the ordinary consumers for a design, generally shall consider the design space of the same or similar type of products to which the patented design belong at the time of the occurrence of the alleged infringement action.
Article 21 of SPC’S Judicial Interpretation on Trial of Patent Infringement Disputes where a provider provides, for production or business purposes and without authorization of the patentee, a product to another party to commit a patent infringement action, with the knowledge that the product is material, device, component, intermediate and so on specialized for exploiting the patent, the People’s Court shall support the right owner if he or it assets that the action of the provider belongs to assisting another party to commit a tort provided in Article 9 of the Tort Law.
In April, 2016, Beijing Intellectual Property Court made the first instance judgment, canceled the Rejection Appeal Decision regarding the mark “AIR RESCUE & Design” made by the Trademark Review & Adjudication Board (TRAB), and determined that the TRAB shall make a new decision on the application for review regarding the mark “AIR RESCUE & Design”.
Two U.S. brands recently battled brand squatters in China with very different outcomes. Facebook won. Apple lost. Jason Wang and Amy Hsiao look behind these different results for strategic insights. What are the key issues to bear in mind when an infringer copies your brand – in China? The authors, including the lead attorney for the Facebook case, tell you the secrets.
Article 20 Where process or treatment is made to a follow-up product, which was obtained by further processing or treating a product directly obtained by a patented process, the People’s Court shall determine the action does not belong to “using the product directly obtained by the patented process” prescribed in Article 11 of the Patent Law.
The Apple-Facebook different outcome is not a result of inconsistency or “double standard”; rather, it is a result of applying the most fitting sets of laws -- under the Chinese system -- to the facts in each case. Although the two cases involve similar facts, the attorneys in each case have relied on different sets of law as their primary arguments and this strategy difference has had a crucial impact on the final outcome.
Article 27 Where it is hard to determine a right owner’s actual loss caused by infringement, the People’s Court shall request the right owner to provide evidence regarding benefit that the infringer has obtained from the infringement according to Article 65, Paragraph 1 of the Patent Law.
Article 59 of the Patent Law of the People’s Republic of China (“Chinese Patent Law”) provides that: The protection scope of a patent right for invention or utility model shall be determined by the terms of the claims. The description and the appended drawings may be used to interpret the content of the claims.
The extent of protection for an inventioCXVZCXVVCVCVXVCVn patent includes not only the extent determined by the technical features literally recited in the claims, but also the extent determined by the equivalent technical features.
In the recent practice, the famous carmaker Tesla Motors, Inc. filed two civil lawsuits in China in September 2013 before Beijing Third Intermediate Court, against ZHAN Bao Sheng. ZHAN is the registrant of the disputed trademark of the “TESLA TESLA MOTORS and T Design” in China, where Tesla Motors, Inc. has filed disputed cancellations before the Trademark Review and Adjudication Board (TRAB) as well.
The patentee who wants to enforce his patent in China should pay attention to the principle of allocating the burden of proof which is one of the most important factors affecting whether the intended goal could be achieved in patent infringement litigation.
Forum shopping is an important issue in a patent infringement lawsuit. Under the Chinese Civil Procedure Law, a plaintiff in an infringement case shall file the litigation with a court at the place of infringement or at the place where the defendant is domiciled. However, it often happens that the alleged infringing manufacturer or seller is not in the jurisdiction where the plaintiff wishes to bring the litigation.
A common question regarding English commercial signs, such as trademarks, personal names, or trade names, is how to protect their Chinese equivalent. On the one hand, the holder of the English commercial sign failed to select the Chinese equivalent for some reasons, or failed to have it registered as a trademark in a timely matter. On the other hand, the holder may have used the Chinese equivalent together with the English mark in commerce, or have used the Chinese equivalent passively.
When foreign brands enter into the China market they are generally translated into Chinese, either for use by the brand owners, or by Chinese media and Chinese public. According to authorities including the China Supreme Court, some Chinese equivalents for its English trademarks are protected, such as GOOGLE, CANON, LAND ROVER, HARLEY (of Harley-Davidson), MICHELIN, PORTS INTERNATIONAL, GIOGRIO ARMANI, SOTHEBY’S, RITZ CARLTON, and FREDDIE MAC. Others are not protected, such as VIAGRA, SONY ERICSSON, DELL, MICHAEL JORDAN, and RANDOM HOUSE. And still others are protected in one case while not protected in another, such as LAFITE.
In June 2015, the Beijing High Court (second instance court) sustained the decisions of the Beijing First Intermediate Court (first instance court) and the Trademark Review and Adjudication Board (TRAB), and held that the opposed mark “FANG DI MEI in Chinese” (FREDDIE MAC in Chinese) constitutes similar to the cited mark “FREDDIE MAC” owned by Federal Home Loan Mortgage Corporation (“Freddie Mac”) in terms of similar services in Class 36. The key issue of this case is the determination of similarity between Chinese equivalent and English mark.
Article 11 of the Chinese Patent Law (2001) generally provides to what extent a patent can be protected under the Chinese law and, on the other hand, what actions are determined to infringe a patent right. Further, a recent court decision by the Supreme People’s Court (SPC) demonstrates that for issues other than those provided in Article 11, the licensing contract shall be the final word on whether an infringement has occurred.
This is the first case for successful enforcement of biological patent in China, which clarifies a feasible definition of new protein patent, i.e. defining homology, origin (species), and function simultaneously. Furthermore, this case provides directions to judgment of future invalidation and infringement cases of new protein patents.
The patentee of this design, Zhiming LI, holds a design patent No. ZL03319125.5, titled “Toothbrush Handle”, which was granted and announced on September 17, 2003. On the same day of the announcement, the patentee authorized Guangdong Sugere Daily Chemicals Co., Ltd. (“Sugere Company” hereinafter, the legal representative of this company is Zhiming LI himself) to make and sell the patented product exclusively.
In patent invalidation or infringement procedures, to prove an uncertain publication date of a prior art or prior design, a plurality of evidences is generally required to form a complete and reliable chain of evidence. Evidence collection and organization usually rely on patent attorneys’ understanding of law and practical experiences. Within a novelty grace period, certain pre-filing disclosures will not cause lose of the novelty of the subsequent patent application. There are rigorous restrictions on such grace period disclosures. It is of vital importance to determine whether a disclosure of an invention-creation before filing can be regarded as a grace period disclosure.
Prior design defense is a very important non-infringement defense system in design patent infringement lawsuits, which allows the People's Court to determine whether an infringement is established simply by determine whether the accused design constitutes similar to the prior design without evaluation of validity of the design patent. This case shows that although a design patent application was submitted before the filing date of the involved patent and published thereafter the filling date (hereinafter referred to as the “earlier design”) does not constitute as prior design. It can be used, however, as the basis for a non-infringement defense by referring to the prior design defense rules, thereby substantially expanding the applicable scope of prior design defense.
In design patent infringement disputes, there is a certain number of copies or imitations across categories. Regarding the problem whether such copy and imitation constitutes infringement, there are different practices among courts. Usually, the question of whether the alleged infringing product and the product incorporating the patent concerned belong to products of identical or similar categories is the prerequisite to whether the alleged infringing product falls into the protection scope of the design patent concerned. Therefore, if the categories of products are neither identical nor similar, a conclusion of non-infringement can be obtained without comparison.
New evidence should be determined according to Article 10 of Interpretation of the Supreme People's Court on Several Issues Concerning Application of the Trial Supervision Procedure of the Civil Procedure Law of the People's Republic of China. Regarding allocation of burden of proof in litigation over infringement of patent process for making non-new products, it may be determined according to the principle of fairness and that of honesty and good faith, taking into consideration such factors as the ability to provide evidence. If the patentee can prove that the product in question is the same as that made by the patent process, and that it has made reasonable effort to prove that the manufacturing process of the product in question falls within the scope of protection of the patent process, using this as a basis and considering the known facts and common experience, it can be presumed that it is very likely that the alleged infringer has used the same process, therefore imposing on the alleged infringer the burden of proof to show that its manufacturing process is different from the patent process.
In determining whether a patent infringement is established based on the doctrine of equivalents (“DOE”), attention should be paid to which feature in a claim is compared against which feature of an accused infringing product. Only those features of a product that are not identical to their counterparts in the claim should be taken into consideration for the purpose of DOE. Determination under DOE is different from the determination on inventiveness during patent prosecution – the requirement of “three substantially, one ordinarily” should be met.
Functional features play important role in the determination of identity or similarity between two designs. When judging whether a design is similar to a prior design, functional features should be considered as “having no influence on the overall visual appearance of a design’s product,” so as to avoid the possible situation of “monopolizing a product’s function on the pretext of protecting a product’s design.”
With reference to new protein inventions, applicants always define biological sequences by the combination of homology and function, so as to obtain a broader scope of protection. However, considering that the association between the primary structure and the function of a protein is highly unpredictable, thus defined protein claim is always considered as not supported by the description and not conforming to Article 26.4 of the Chinese Patent Law. Therefore, discussions in this filed focuses on a proper manner to define a new protein patent and subsequently obtained protection scope. This is the first case for successful enforcement of biological patent in China, which clarifies a feasible definition of new protein patent, i.e. defining homology, origin (species), and function simultaneously. Furthermore, this case provides directions to judgment of future invalidation and infringement cases of new protein patents.
This case clarifies that in the determination of inventiveness of a crystalline compound, the wording “structurally similar compounds” specifically refers to compounds having the same central part or basic ring, and has nothing to do with comparison between microcrystalline structures. The microcrystalline structure difference shall be considered only if it brings unexpected technical effect.
The highlight of this case is the confirmation that generally a close-ended claim of a chemical composition shall be construed as the composition merely consisting of the indicated components, and including no other components but impurities in a normal amount, while adjuvants do not belong to the impurities.
With reference to inventive step of compound claims, it is stipulated in the Guidelines for Patent Examination that for a compound NOT similar in structure to a known compound, it will be regarded as inventive when it has a certain use or effect where a compound that IS similar in structure to a known compound, it might be regarded as inventive only if it has an unexpected use or effect. As can be seen, it is important to judge whether a compound is structurally similar to a known compound. This case clarifies that in the determination of inventiveness of a crystalline compound, the wording “structurally similar compounds” specifically refers to compounds having the same central part or basic ring, and has nothing to do with comparison between microcrystalline structures. The microcrystalline structure difference shall be considered only if it brings unexpected technical effect.
The patentee, HU Xiaoquan, owns a patent for invention No. ZL 200410024515.1, titled "Process for the Preparation of an Injection of Adenosine Disodium Triphosphate and Magnesium Chloride," wherein claim 2 recites the additional technical features, "a freeze-dried powder injection of adenosine disodium triphosphate and magnesium chloride for injection, consisting of adenosine disodium triphosphate and magnesium chloride at the ratio by weight of 100 mg to 32 mg."
This case highlights the premise to admit the post-filing experimental data for determination of inventiveness, i.e. such data should direct to the technical effect described in the original application documents.
The patentee, Takeda Pharmaceutical Co.,Ltd. (hereinafter “Takeda”), owns a invention patent No. ZL96111063.5 titled as “Pharmaceutical Composition for Use in Treatment of Diabetes” (hereinafter “the patent concerned”). Claim 1 was “pharmaceutical composition useful for prophylaxis or treatment of diabetes, diabetic complications, glucose or lipid metabolism disorders, which comprises an insulin sensitivity enhancer selected from pioglitazone or a pharmacologically acceptable salt thereof, and Sulfonylurea as insulin sensitivity enhancers.”
Experimental data is vital to the patentability requirements of inventiveness, support, and enablement for chemical/medical application. During the substantive examination, the applicant may intend to supplement experimental data to support inventiveness after filing, which is called “post-filing experimental data”. It is controversial whether post-filing experimental data shall be admitted. This article discusses admission of post-filing experimental data, as well as the binding effect of examination result in other countries based on analysis on an actual case.
This judgment illustrated that the date when a patent right is declared invalid shall be the decision date of the patent invalidation proceeding.
This case relates to invention patent No. ZL 96107072.2 of the patentee, Qianping AO. After issuance of the patent, the patentee issued a license to Shenzhen DNS Industries Co., Ltd. (“DNS Industries” hereinafter), agreeing that DNS Industries can further permit a third party to exploit the patent in a manner of commissioned processing such as OEM or ODM.
Zhejiang Huali Communication Group Co., Ltd. (hereafter referred to as “Huali Communication”) is the sole and exclusive licensee of a licensing contract for exploitation (in which the patentee does not retain any right to exploit its technology) of an invention patent titled “CDMA/GSM dual-mode mobile communication method and communication device thereof” with Patent No. ZL02101734.4 (hereafter referred to as “the involved patent”).
Examination Decision No. 19631, which is related to the validity of patent No. ZL95190642.9, titled “Shaving Apparatus”, is the first decision that involves the petitioner withdrew the invalidation request and the examination of the request for invalidation was not terminated. This is the PRB’s first application of the principle of conducting examinations ex officio under Rule 72.2.
The principle of prior art defense established in patent infringement litigation means that the scope of protection of a patent right shall not encompass the prior art. The rationale of the principle is that the public have the right to freely practice the prior art known to the public, and no one is entitled to claim the prior art into the scope of an exclusive patent right, or else the public interest will be damaged. In addition to examining the legal validity of the patent right in the patent invalidation procedure, examining an accused infringer’s assertion of the prior art defense in the patent infringement litigation is advantageous for timely resolving disputes, reducing litigation exhaustion of the parties, and realizing unification of equity and efficiency. The prior art defense and its difference from determination of novelty judgment or inventiveness in the patent invalidation procedure are articulated in this case, which facilitate the parties’ understanding the standards of application of the prior art defense by the courts in China.
As prescribed in the Chinese Trademark Law, application for registration of a trademark shall not create any prejudice to another person’s prior right, which includes prior copyright. Prior copyright is considered as an important aspect in trademark disputes with various advantages to claim against the disputed trademark, such as automatic protection without registration, cross-jurisdiction protection and cross-Class protection.
A technical solution refers to a collection of technical means that are adopted to solve a technical problem and utilize the laws of nature. Generally, a technical means is embodied by one or more technical features. When an invention-creation, especially inventiveness of a claim, is evaluated, usually a standard three-step method is adopted. However, there is a deviation that an invention-creation is NOT evaluated as an organic whole and a claim is divided as several fragmented parts and the respective parts are evaluated separately. However, such kind of evaluation is inappropriate. In this case, the Supreme People’s Court emphasized that an invention-creation should be evaluated as a whole.
The usage environment feature refers to a technical feature for describing the environment or conditions under which an invention is applied. The usage environment feature included in a claim is a part of the essential technical features of the claim, contributes to define the protection scope of the claim, and thus shall be considered when determining the protection scope of the claim.
On October 15, 2014, Rule 14 of the Provisions of the Supreme People’s Court (SPC) on Several Issues concerning the Trial of Administrative Cases Involving the Granting and Determination of Trademark Right (Draft for Comment) was released by the SPC with two different opinions regarding the weight of evidence of trademark registration certificate and trademark gazette in determining copyright ownership. The first opinion provides that, “trademark gazette, trademark registration certificate, etc. may serve as prima facie evidence to ascertain the copyright owner or the interested party thereof. Where the applicant of the disputed trademark opposes, that applicant has the burden to provide counter evidence to support his opposition.”
According to Article 61, Paragraph 1 of the Chinese Patent Law (2009), a patentee may choose to shift its burden of proof for infringing process to the defendant when the patented process is for obtaining new product. However, to take use of such convenience, the patentee has to satisfy some preconditions. This case illustrates that the patentee have to submit preliminary evidence regarding “new product.” Based on this case, this article will discuss all the preconditions for application of Article 61, Paragraph 1 with an overview.
The patentee Manfred A. A. Lupke (hereinafter referred to as “Lupke”) owning an invention patent No. ZL95192937.2 brought a lawsuit before the Tianjin Intermediate People’s Court against Weifang Zhongyun Machine Co.,Ltd. (hereinafter referred to as “Zhongyun Machine”) as the producer of a corrugated pipe manufacturing equipment, and Tianjin Shengxiang Plastic Pipe Industry Co., Ltd. (hereinafter referred to as “Shengxiang Industry”) as the user of the equipments, alleging that the corrugated pipe manufacturing equipment produced by Zhongyun Machine has infringed the patent.
The latter half of Article 32 of the Chinese Trademark Law 2013 (Article 31 of the Chinese Trademark Law 2001) stipulates that“ preemptive registration by unfair means of a trademark with certain fame already used by another party” shall not be approved (“Bad Faith Filing Provision”). From the literal understanding of such provision, the fame of the trademark with prior use and the bad faith of the applicant of the disputed trademark are two requirements for application of law for the Bad Faith Filing Provision.
A method patent is different from a product patent in that it protects a dynamic operation process. How to compare between the method used by the defendant and the patented process is a key point when the court tries an infringement case involving a process patent. In this case, by finding the technical feature difference of the products, the court held that the two processes are neither identical nor equivalent and thus the defendant does not infringe upon the plaintiff’s patent. This shows a new way for judging infringement upon a process patent.
The Interpretation of the Supreme People's Court on Several Issues concerning the Application of Law in the Trial of Patent Infringement Dispute Cases stipulates, in Rule 6, “where the applicant or patent right owner abandons a technical solution through amendments to the claims and/or specification or observations during the prosecution of the application or the invalidation proceedings of the patent, the court shall not support the right owner’s claim of reclaiming the abandoned technical solution back into the protection scope in the infringement litigation case.” Therefore, application of the DOE is premised with a condition that the right owner has abandoned the technical solution through amendments or observations during the patent prosecution or invalidation proceedings.
An equivalent feature is a feature that, as compared to the feature described in a claim, performs substantially the same function by substantially the same means, produces substantially the same effect, and can be associated by an ordinary person skilled in the art without any inventive work. While determining whether a prosecuted product falls within equivalent infringement, the means, function, effect, and inventive work should be determined in the above order. Only when all four elements of a feature meet the above conditions, the feature can be determined as an equivalent feature.
When determining whether an infringement is established by employing the equivalent doctrine, it is necessary to compare technical features of an involved patent with those of an alleged infringing product, so division of technical features will influence determination of an equivalent feature. In this case, the Supreme People’s Court suggests that for division of technical features of a claim, a technical unit that is able to implement a relatively independent technical function generally should be considered as one technical feature, and it should not designate multiple technical units that implement different technical functions as one technical feature.
The case relates to an infringement dispute between Patentee, Wanqing BAI, and Chengdu Nanxun Marketing Service Center (hereinafter referred to as “Nanxun Center”), Shanghai Tianxiang Industry Co.,Ltd. (hereinafter referred to as “Tianxiang Industry”).
The patentee, Zhaoqing New Leader Battery Industry Co.,Ltd. et.al.(“New Leader Battery” hereinafter), has a utility model patent No. ZL01234722.1 titled “Mercury-free Alkaline Button Cell Battery.” The involved patent underwent three rounds of invalidation after the date of authorization proclamation. Finally, the Patent Reexamination Board (the “PRB” hereinafter) made the No. 13560 decision on the request for invalidation (hereinafter referred to as the invalidation decision) on June 9, 2008 declaring that all claims of the involved patent are invalidated. In the subsequent administrative litigation, both the court of first instance and second instance judged that the invalidation decision should be reversed.
Xi’an Qinbang Telecommunication Material Co.,Ltd. (hereinafter referred to as “Qinbang”) is the patentee of Chinese Invention Patent No. ZL01106788.8 titled “Method for Manufacturing Smooth Metal-shield Composite Belt.” Qinbang brought a patent infringement lawsuit to the Xi’an Intermediate People’s Court against three defendants including Wuxi Longsheng Cable Material Factory (hereinafter referred to as “Longsheng Factory”) and other two entities, claiming monetary damages and injunctions.
Claim interpretation is the key to determine the scope of protection of claims. The meaning of the claims can be determined based on internal and external evidence using a variety of interpretation methods, wherein the methods of interpretation can verify each other, eliminating contradictory, uncertain or ambiguous conclusions in order to obtain reasonable and accurate protection scope of the claims.
The judge held in this case that, if, by looking into the nature and degree of the typing mistakes, the person skilled in the art can naturally identify the typing mistakes and appreciate the corrected meaning of the typing mistakes, the typing mistakes shall be interpreted in a corrected manner. Consequently, negative effect of the typing mistakes on validity of valuable patents can be reduced, especially in the current circumstance where there exists no post-grant correction procedure for correcting typos and other clerk errors.
The judge proposed an important principle for claim construction in this case, holding that the claim construction should comply with the purpose of invention described in the detailed description of the patent application.
With China’s rapid economic developments, the relevance of similar goods and services changes with the method of commercial trading, consumption habit, and consumer psychology. However, the Classification of Similar Goods and Services may not include all the goods and services, and there are often contradictions when determine whether goods and services are similar or not. There is a new trend that the Chinese Trademark Office (CTMO), the Trademark Review and Adjudication Board (TRAB), and the courts begin to grant cross-class protection by deeming goods and services similar.
Avago Technologies General IP (Singapore) Pte. Ltd. (hereinafter referred to as “Avago”), successfully obtained registration for its core trademark (A Logo) (Registration No. 5226289, red color designated) in China in January 2010.
The application for registration of the A Logo was filed in the name of Argos Acquisition Pte. Ltd. (hereinafter referred to as “Argos”) in 2006 (the A Logo was later assigned to Avago in 2009). In 2008, the A Logo was rejected by the Chinese Trademark Office (CTMO) on the ground that it shall be deemed similar to the prior registered trademark (International Registration No. 789052) in terms of similar goods. Avago filed a rejection appeal before the TRAB.
Original Equipment Manufacturer, commonly known as “OEM,” is and will continue to be a huge business in China. Whether OEM constitutes trademark infringement is of great practical significance to foreign companies whose manufacturing bases are in China, and the issue has always been the subject of hot debates. In OEM business, a local Chinese company manufactures the products on behalf of a foreign brand owner with the foreign brand owner’s trademark, but the products are solely for export and not sold in China.
In April 2014, the Supreme People’s Court (SPC) announced the list for China Courts 2013 Top 10 Innovative IP Cases. These Top 10 Innovative IP Cases were selected from over one hundred thousand (100,000) decisions of nationwide courts in China rendered in 2013, which have significant and innovative contribution to application of the laws and regulations.
In the recent practice, the famous carmaker Tesla Motors, Inc. filed two civil lawsuits in China in September 2013 before Beijing Third Intermediate Court, against ZHAN Bao Sheng. ZHAN is the registrant of the disputed trademark of the “TESLA TESLA MOTORS and T Design” in China, where Tesla Motors, Inc. has filed disputed cancellations before the Trademark Review and Adjudication Board (TRAB) as well. In one of the civil lawsuits, Tesla Motors, Inc.
Since the implementation of the Chinese Trademark Law 2001, the courts (the Beijing First Intermediate Court as the first instance court and the Beijing High Court as the second instance court) have been granted the final adjudication power for administrative cases involving the authorization and confirmation of trademark rights (hereinafter referred to as “Trademark Administrative Cases”), where interested parties sued the Trademark Review and Adjudication Board (TRAB) to court in connection with its administrative decisions in trademark rejection review, trademark dispute, and trademark cancellation review.
The cases of three-year non-use trademark cancellation have been on the rise in the recent years and have attracted more and more attention. However, as to some special circumstances (such as the trademark obtaining registration after the opposition procedure and the international trademark registration designating China for territorial extension), the registration date (the date when the exclusive right to use a trademark is granted) may probably be inconsistent with the date when the registration status has been confirmed (the date when the trademark administration or judicial authority finally determines and grants the trademark right).
The earliest Chinese regulations with regard to “examination on the disclaimer to the exclusive right to use the trademark” appeared in Trademark Examination Rules, which was promulgated by the Chinese Trademark Office (CTMO) in 1994. Rules 3 and 4 of the CTMO Notice on Issues concerning Trademark Examination Notification [Shang Biao (2000) No. 80] further stipulated the specific circumstances where the exclusive right to use the trademark should be disclaimed.
In April 2012, the Trademark Review and Adjudication Board (TRAB) announced the latest list of well-known trademarks recognized in China, including “Sina & design, Sina, SINA NET in Chinese,” and “SOHU in Chinese.” Up to date, around ten trademarks have been recognized as well-known in the Internet industry in China.
The newly revised Chinese Trademark Law 2013 adopts Article 58 which prescribes as follows: “Where the registered trademark or unregistered well-known trademark of others is used as a trade name contained in the enterprise name, which is likely to mislead the public and constitutes unfair competition, it shall be adjudicated under the Chinese Anti-Unfair Competition Law.”
In February 2013, the Supreme People’s Court (SPC) rendered a decision [The SPC Administrative Order (2012) Zhi Xing Zi No. 9] (the SPC No. 9 Order) on the re-trial case of the trademark “Duck King in Chinese” filed by Shanghai Huai Hai Duck King Roast Duck Restaurant Co., Ltd. (previously named as Shanghai Huai Hai Quanjude Roast Duck Restaurant Co., Ltd., hereinafter as “Shanghai Duck King”).
More and more multinational companies (MNCs) are realising that, as an indispensable part of a global IP strategy, importance of successfully enforcing IP right in China cannot be overstressed. Besides administrative remedy, initiating IP infringement lawsuit in China is widely considered as a feasible yet challenging measure for enforcing IP rights.
This article is the English translation for Mr. Wang’s article in Chinese published on China Trademark magazine (Issue 3, 2011). China Trademark magazine is sponsored by China Trademark Association under supervision of the State Administration for Industry and Commerce (SAIC) overseeing the Chinese Trademark Office (CTMO) and the Trademark Review and Adjudication Board (TRAB).
The DUCK KING trademark re-trial is listed as No. 7 of China 2013 Top 10 Innovative IP Cases (published by the Supreme People’s Court on April 21, 2014).
The English translation below [CASE BRIEF and INNOVATIVE SIGNIFICANCE] is prepared by Beijing East IP Law Firm for reference merely, based on Chinese Language Version published by the Supreme People’s Court. Beijing East IP Law Firm also provides comments and analysis on this case.
Article 31 of the Chinese Trademark Law states that “using unfair means to preemptively register the trademark of some reputation of another person has used” shall not be registered. According to the provision’s language, fame of the prior mark and the bad faith of the trademark applicant are the two applicable elements of the bad faith filing prescribed by Article 31.
On March 17, 2014, the State Intellectual Property Office (SIPO) issued Order No. 68. Under this Order, graphic user interface (GUI) is becoming eligible for design patent protection as of May 1, 2014.
Since the reform and opening-up in 1978, China has seen huge increase of foreign direct investment. More and more foreign companies have set up their R&D centers in China, hence making more and more invention-creations therein.
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.
China is becoming an arena of significant importance where companies are taking advantage of patent portfolios against competitors. According to “2012 Intellectual Property Rights Protection in China” issued by State Intellectual Property Office of China, in 2012, local people’s courts around China accepted 9,680 patent civil cases, with year-on-year increase of 23.80%.
This "Guidance on Hearing Rewards or Remunerations Disputes of Service Invention Made by an Employee-Inventor or Designer" was promulgated by IP tribunal of Shanghai High People’s Court in June, 2013.
On August 30, 2013, China National People’s Congress enacted the amended the Chinese Trademark Law, and the new Chinese Trademark Law shall come into effect as of May 1, 2014. The current Chinese Trademark Law was enacted in 1982, and amended in 1993 and 2001 respectively. In December 2012, June 2013 and August 2013 respectively, the National People’s Congress has reviewed the draft amendments of the Chinese Trademark Law three times. We have sorted out the key amendments of new Chinese Trademark Law. Please see below the brief.
The Supreme Court held that “as long as the content inferred directly and unambiguously from the original disclosure is obvious to the person skilled in the art, such content belongs to the original disclosure of the filing document under Article 33 of the Chinese Patent Law.”
The proposed 4th amendment aims to strengthen the protection of patent rights, which is a good news to applicants.
However, instead of improving current patent enforcement related proceedings via judicial route, the current draft tends to achieve the above goal via administrative route by granting more power to the administrative organ (local patent bureau), which causes concerns from overseas clients, and judicial system oppositions.
Foreign applicants are very interested in how to claim priority when they want to file a Chinese design application. We will introduce some relevant issues about foreign priority.
China has overtaken America again. Its patent office received more applications than any other country’s in 2011. (The numbers were released in December.) But look closer, and the picture is murkier.
Business method application cannot be granted a patent right before the SIPO, unless you are very careful at the very beginning of drafting an application, fully understand the special tactics during prosecution of the application, and foresee the direction SIPO is heading regarding examination of a business method application.
The SIPO is coming up with the Draft of Service Invention Regulation aiming for protecting the right of a service inventor for claiming reward when the application is filed and remunerations when an application is patent granted and/or practiced from which the applicant obtains benefit.
The SIPO is proposing to amend relevant regulations in the Patent Examination Guideline to protect partial design/UI with design patent.