Quarterly China Trademark News Updates

July – September 2021

1. Notable trademark and anti-unfair competition cases

a. The Beijing High Court rejected a retrial petition filed by Beijing Wuyinliangpin against MUJI

On July 13, 2021, the Beijing High Court rejected a retrial petition filed by Beijing Miantian Textile Co., Ltd. (“Beijing Miantian”) against Muji (Shanghai) Commercial Co., Ltd. and Beijing Chaoyang Third Branch of Muji (Shanghai) Commercial Co., Ltd. (together as “MUJI”).

Beijing Miantian owns registered trademarks “Wuyinliangpin in Chinese” in class 24 for “cotton textiles and towels.” These trademarks were licensed to Beijing Wuyinliangping Investment Co., Ltd. for use in China. Ryohin Keikaku Co., Ltd. owns the “MUJI” registered trademark in class 24, the “Wuyinliangping in Chinese” registered marks in class 16 and class 35, and the “Wuyinliangping in Chinese and MUJI” registered mark in class 35. Ryohin Keikaku Co., Ltd. licensed the said trademarks to MUJI for use in China. Beijing Miantian sued MUJI alleging that MUJI’s use of the “Wuyinliangpin in Chinese” mark on store signboard, header of the shopping receipt, and shopping bags infringed upon its registered trademarks “Wuyinliangpin in Chinese” in class 24 for “cotton textiles and towels.”

The court found that MUJI’s use of the “Wuyinliangpin in Chinese” mark on its signboard shall be considered as use on selling general merchandise goods. The use of the “Wuyinliangpin in Chinese” logo on the header of the shopping receipt was the unified format of the shopping receipt provided by the store when selling goods, and did not specifically point to towels, quilts or other specific products. Such use still constituted as trademark use in providing general merchandise sales services. Except for the “Wuyinliangpin in Chinese and MUJI” logo on the outside, no other words were printed on the body of the disputed shopping bag. From the appearance, the disputed shopping bag cannot be seen to have a specific connection with the goods approved for use under Beijing Miantian’s trademarks in this case. Meanwhile, MUJI was authorized by its parent company, Ryohin Keikaku Co., Ltd., the right to use the “Wuyinliangpin in Chinese” trademark in class 16 for packaging paper bags and other goods. The court found that MUJI’s uses of the disputed trademarks on its store signboard, head of the shopping receipts and shopping bags were trademark use in the process of sales services, which were not identical with or similar to approved goods under Beijing Miantian’s trademarks and did not constitute as trademark infringement.

b. Schneider China won a RMB 3 million judgement against malicious and repeated trademark infringement

On July 21, 2021, the Beijing Chaoyang District Court heard a trademark infringement case involving Schneider China and fully supported Schneider China’s economic losses claim of RMB 3 million (USD 462,600).

In January 2013, Schneider China filed a complaint against the defendant Hangzhou Dongheng Company’s predecessor Hangzhou Schneider Electric Co., Ltd. (“Dongheng”) for trademark infringement, and using the “Schneider” brand name in corporate names and publicity before the Hangzhou Xiacheng District Court. Through mediation by the court, Dongheng ceased its infringement, changed its company name, and compensated Schneider China for economic losses and reasonable expenses of RMB 100,000 (USD 15,419).

The Beijing Chaoyang District Court’s investigation revealed that after the mediation was concluded, Dongheng had since continued to use the “Schneider” trademark extensively throughout its official website. Meanwhile, in the “China Supplier Network” operated by a technology company in Beijing, Dongheng also had a product display page which used a large number of Chinese and foreign trademarks of “Schneider/Schneider in Chinese” in the company and products introductions. The said use continued until 2019.

The Beijing Chaoyang District Court found that Dongheng’s use of the “Schneider” and “Schneider/Schneider in Chinese” logos on its website and web pages constituted trademark infringement. Considering that Dongheng was a repeated infringer, its subjective malice was obvious, the infringement duration was long, and the fame of Schneider’s trademark, the court fully supported its compensation claim of RMB 3 million (USD 462,600).

c. Ralph Lauren was found not infringing in a second instance decision

Guangzhou Aichi Leather Co., Ltd. (“Aichi”), the owner of the “POLO” mark in class 18 “wallets, school bags, small wallets, handbags, travel bags (cases), etc.,” sued Ralph Lauren to the Beijing Chaoyang District Court, requesting an order to stop the infringement and compensate for economic losses and other legal expenses.

The Beijing Chaoyang District Court found that Ralph Lauren’s prominent display or independent use of “POLO” on the alleged infringing products and tags could easily cause relevant consumers to be confused and misidentify the source of the goods, which infringed on Aichi’s trademarks rights. Considering factors such as the location, scale, quantity, and duration of the stores operated by Ralph Lauren, the unit price of the alleged infringing goods, and the degree of subjective fault of Ralph Lauren, the Beijing Chaoyang District Court ordered Ralph Lauren to compensate Cichi for economic losses of RMB 3 million (USD 462,900).

Ralph Lauren appealed to the Beijing Intellectual Property Court. The court recently made a final judgment in favor of Ralph Lauren’s appeal request, revoked the first instance judgment and dismissed Aichi’s request. The court found that: although the word “POLO” was embroidered or highlighted on some of the goods, from the perspective of the specific usage and usage scenarios of the alleged infringing mark, the said allegedly infringing goods were all displayed and sold at Ralph Lauren shops, and all labeled with “RALPH LAUREN” and “Ralph Lauren Trading (Shanghai) Co., Ltd.,” which clearly indicated the provider of the alleged infringing goods. On the contrary, Aichi did not provide evidence of use of the disputed trademark on the allegedly infringing goods and its trademark had obtained certain influence through use. Therefore, when consumers entered Ralph Lauren stores to purchase related goods, they would clearly recognize that the goods they bought were from Ralph Lauren without associating them with Aichi, or mistakenly believing that there is specific relationship between the two entities. Accordingly, the use of the alleged infringing mark would not cause the relevant public to confuse or mistake the source of the goods.

As far as the subjective intention of taking advantage of other’s goodwill, the evidence in the case proved that Ralph Lauren’s registration of multiple “POLO” and “POLO RALPH LAUREN” trademarks in multiple related classes, and the extensive promotion and use of “POLO” and “RALPH LAUREN” on clothing and other goods has established a stable correspondence between the “RALPH LAUREN” logo with Ralph Lauren and its affiliates and has gained a certain degree of popularity and influence. Therefore, Ralph Lauren’s selling of the allegedly infringing goods in its stores did not have subjective bad faith in taking advantage of Aichi’s goodwill.

Accordingly, although Aichi had the right to claim trademark rights as the legal rights holder, Ralph Lauren’s use of the alleged infringing mark will not cause market confusion. The Beijing Chaoyang District Court erred in its findings and should be amended.

d. The “BVLGARI and BVLGARI in Chinese” mark was recognized as a well-known mark

Bulgari S.P.A. (“Bulgari”) filed an invalidation request against Cai Qinghe’s trademark (“Disputed Mark”) based on its prior trademark in Class 14 and International trademark in Class 42.

Disputed Mark	Bulgari Prior Mark in Cl. 14	Bulgari Prior Mark in Cl. 42

Upon hearing, the Beijing High Court found that the invalidation request was filed on April 2, 2017, more than five years after the Disputed Mark’s registration date (November 6, 2011). Therefore, Bulgari’s invalidation request based on Article 28 and Article 31 of the Chinese Trademark Law 2001 (“TM Law 2001”) shall be rejected. However, combined with the journals and magazines submitted by Bulgari and various media reports on Bulgari regarding its “BVLGARI and BVLGARI in Chinese” brand jewelries and watches, national library search reports, award certificates and materials, introduction to the distribution of Bulgari specialty stores, and the lease contract of its China retail stores, lease contracts and photos of its China franchised stores and watch counters, sales invoices and bank card slips, records of administrative and judicial protection of the “BVLGARI and BVLGARI in Chinese” trademark, and other evidence can prove that Bulgari has carried out long-term and continuous promotion and sales of its “BVLGARI and BVLGARI in Chinese” jewelries and watch products in China. Bulgari had obtained a wide range of publicity and high sales income. Based on the foregoing, it can be determined that Bulgari’s prior mark in Class 14 had obtained a great reputation and influence on “decoration (jewelry); watch” related goods and had been widely known to the public, which constituted as a well-known trademark under Article 13 Paragraph 2 of the TM Law 2001. The Beijing High Court concluded that the Disputed Mark’s registration improperly took advantage of Bulgari’s well-known trademark’s market reputation and damaged its rights, which violated Article 13 Paragraph 2 of the TM Law 2001.

e. Dr. Martens’ “Marten Boots in Chinese” was found to be lack of distinctiveness

Dr. Martens International Trading GmbH is the owner of the well-known footwear brand “Dr. Martens.” Its Chinese trademark “Marten boots in Chinese” in Class 26 was rejected by the China National Intellectual Property Administration (“CNIPA”) because the mark directly referred to the function and purpose of the goods. After the first and second instances, both the Beijing Intellectual Property Court and the Beijing High Court found that “Marten boots” is a type of leather shoes, and when such mark was used on “shoelaces” and related goods in Class 26, it directly indicated the function and purpose of the goods. Such use was difficult to distinguish the mark and the source of goods based on the relevant consumer’s knowledge. Moreover, Dr. Martens did not submit sufficient evidence to prove that the “Marten Boots in Chinese” mark had obtained distinctiveness through its use (Beijing East IP’s search of the prosecution history of “Marten Boots in Chinese” revealed that the mark in Classes 25 and 35 was also rejected based on the same reasoning).

f. Universal Pictures was awarded RMB 5.1 million in compensation in a “Minions” copyright dispute

Recently, the Jiangsu High Court rendered a favorable decision for Universal Pictures against defendants Cangzhou Qianchixue Food Co., Ltd. (“Qianchixue”), Jingbaojiang, Jingshusong, Wangzi Beverage (Guangzhou) Group Co., Ltd. (“Wangzi”), Guangdong Tainiu Vitamin Beverage Co., Ltd. (“Tainiu”), Wuxi Weiwei in a copyright dispute involving the “Minions” copyright. The court affirmed the first instance court’s decision and ordered the defendants, except Wuxi Weiwei, to pay RMB 5 million (USD 788,400) altogether and ordered Wuxi Weiwei to separately pay RMB 100,000 (USD 15,458) in compensation to Universal Pictures.

Universal Pictures is a world-renowned film and television studio. After being released in China, the Minions film series gained enormous reputation. Without the authorization of Universal Pictures, Qianchixue mass-produced and sold dairy beverages with a graphic that was substantially similar to the “Minions.” Before the alleged infringing products were put on the market, other beverage companies had obtained authorization to use the “Minions” image from Universal Pictures. Qianchixue’s infringing products affected the sales of licensed products by other legal licensees. The court ruled that although the alleged infringing image used by the alleged infringing product was slightly different from the artwork involved, it included many main original features of the “Minions,” which constituted as substantially similar.  Without the permission of Universal Pictures, Qianchixue used the involved artwork on the alleged infringing products, manufactured, sold, publicized and promoted the alleged infringing products, infringing the reproduction and distribution right of the involved artwork. The defendants Jingbaojiang and Jingshusong facilitated Qianchixue’s alleged infringing activities, which constituted as joint infringement. The defendants, Tainiu and Wangzi, as the trademark owners and licensees of the alleged infringing products involved in the case, had a close interest and cooperation relationship with Qianchixue, which constituted joint infringement. Wuxi Weineng sold the alleged infringing products online, which constituted as infringement, and was ordered to separately compensate Universal Pictures for RMB 100,000 (USD 15,458).

g. “NEW BALANCE” ousted “New bunren”

On August 13, 2021, the Beijing High Court affirmed the first instance court decision in favor of the CNIPA over a trademark invalidation dispute.

Disputed Mark	Cited Mark

The Disputed Mark was approved for registration on January 7, 2011, and New Balance filed an invalidation petition on June 28, 2018, after the five-year statute of limitation on filing an invalidation petition against a registered trademark. The CNIPA, however, found that the Disputed Mark constituted as maliciously imitating other’s well-known registered trademark under Article 13(3) of the Chinese Trademark Law, and concluded that New Balance’s invalidation petition was not limited by the five-year statute of limitation.

The Beijing High Court affirmed the first instance court decision finding that New Balance had submitted sufficient evidence proving that the Cited Mark was widely known and enjoyed high fame among the relevant public on “shoes” related goods and constituted as a well-known mark.

Article 13(3) of the Chinese Trademark Law protects well-known trademarks in China and is applicable to registered trademarks. The legislative intention of Article 13(3) is to provide stronger protection to well-known trademark than general registered trademarks. If identical or similar trademarks are registered or used on identical or similar goods approved for the well-known trademark, the consequential damage on the well-known trademark is obviously higher than those trademarks registered or used on different or dissimilar goods. Therefore, applying for trademark registration by copying, imitating, and translating other’s registered well-known trademark on “identical or similar goods” shall be regulated by Article 13(3).

In this case, both the Disputed Mark and the Cited Mark contained “NEW,” while the pronunciation of “BALANCE” and “bunren” was similar, thus, the Disputed Mark and the Cited Mark were similar in terms of word compositions, pronunciations, overall appearances, and visual effects. The Disputed Mark constituted as an imitation of the Cited Mark. The goods approved for the Disputed Mark were identical or similar to the shoes related goods approved under the Cited Mark in terms of function, use, production department, sales channels, consumers, etc., which constituted as identical or similar to the Cited Mark’s approved goods. Where the Cited Mark has constituted a well-known trademark and the Disputed Mark is an imitation of the Cited Mark, when purchasing goods approved for use by the Disputed Mark, the relevant public would easily believed that such goods had certain association with the Cited Mark, which would weaken the Cited Mark’s distinctiveness and damage New Balance’s interests obtained through its well-known Cited Mark. The Court concluded that the Disputed Mark violated Article 13(3) and shall be invalidated.

h. The mark “MOPIDICK in Traditional Chinese” was maintained on cosmetic goods

IKEDA MOHANDO CO., LTD. (“IKEDA”) registered the MOPIDICK in Traditional Chinese mark (“Disputed Trademark”) on August 28, 2014, in Class 3 for “cosmetics, soaps, fragranced soaps, fragrances, cosmetic nails, cosmetic eyelashes, perfume, toothpaste.”

A individual filed a non-use cancellation and later a cancellation appeal against the Disputed Trademark. The CNIPA concluded that the evidence submitted by IKEDA showed that the Disputed Trademark was used on anti-mosquito and anti-itch liquid products, which were closely related to cosmetic products in function, sales location, consumer, etc., and the trademark shall be maintained on cosmetic goods. However, the evidence did not show that the Disputed Trademark was used for soaps, fragranced soaps, fragrances, cosmetic nails, cosmetic eyelashes, perfume and toothpaste, and the mark’s registration on these goods shall be cancelled accordingly.

IKEDA appealed to the Beijing Intellectual Property Court and the court found that the online sales and publicity evidence submitted by IKEDA could prove that it had actually used the Disputed Trademark on the “anti-mosquito and anti-itch liquid” products within the specified period. In view of the strong correlation between the “anti-mosquito and anti-itch liquid” products and the “cosmetics” goods approved for the Disputed Trademark in terms of function, use, sales location, and consumers, the Disputed Trademark shall be maintained on the “cosmetics” goods. According to the Classification of Similar Goods and Services, “fragrance, cosmetic nails, cosmetic eyelashes, soap, fragranced soap” and “cosmetics” goods belong to the same subclass, and the Disputed Trademark shall be maintained on these goods as well. In addition, the Disputed Trademark’s approved goods of “toothpaste, perfume” and “cosmetics, soaps, fragrance” were all daily washing and chemical goods, and they were highly similar in terms of function and use, production department, sales channel and consumers. According to Article 2 of the Regulations on Hygiene Supervision of Cosmetics and relevant regulations, cosmetics refer to daily chemical industrial products that are spread on skin, hair, nails, lips and other parts of the human body by wiping, spraying or other similar methods to achieve the purposes of cleaning, eliminating bad smell, skin care, beauty and decoration. Therefore, the Disputed Trademark’s approved use of “toothpaste and fragrance” products should also be covered by cosmetics in terms of function and use. Therefore, “toothpaste and fragrance” and “cosmetics” should be deemed as similar goods, and the Disputed Trademark’s approved use for “toothpaste and fragrance” shall be maintained.

The CNIPA appealed the first instance decision to the Beijing High Court. The Beijing High Court recently affirmed the first instance court decision that the disputed trademark “MOPIDICK in Traditional Chinese” shall be maintained for its registration on cosmetics, toothpastes, fragrances, and other designated goods.

Guangzhou Xinbailun and Jiangxi Xinbailun were unsatisfied with the judgment, and NB was unsatisfied with the court’s findings of “New Balance in Chinese” and the compensation amount ordered. All parties appealed the first instance judgment to the second instance court, the Beijing IP Court. The Beijing IP Court affirmed the first instance court’s judgment.

i. The Beijing High Court: Trademark co-existence agreement does not automatically equal to grant of trademark protection

Volkswagen applied the “TAYRON” mark which was blocked by the prior registered trademark “TYRON.” Volkswagen submitted a trademark co-existence agreement issued by the owner of the prior trademark, however, the Beijing High Court found that the disputed mark “TAYRON” was almost identical to the prior trademark “TYRON,” thus, even if the co-existence agreement is legal, authentic, and effective, it would not be enough to eliminate the possibility to confuse or to mislead the relevant public regarding source of the goods. Therefore, the trademark co-existence agreement could not be the basis for the registration of the disputed mark “TAYRON” and the court rejected Volkswagen’s appeal.

2. Notable trademark laws, regulations, and news updates

a. Summary analysis of administrative litigation of trademark review and adjudication cases in 2020

In 2020, the Trademark Office’s review and adjudication departments have ruled a total of 358,300 cases and received a total of 14,977 first instance response notices. The number of first instance responses received accounted for 4.18% of the total number of adjudications, which basically leveled with the previous year. A total of 5,933 second instance response notices were received, a slight increase from last year.

The overall review cases loss rate of the Trademark Office’s review and adjudication departments in 2020 was 24.62%, and the actual loss rate after excluding cases with change in circumstances is only 9.8%, which was a significant drop from the actual loss rate of 13.9% in the previous year.

Type of Cases	Total rulings	Total losses (due to change of circumstances)	Loss rate (excluding change of circumstances)
Rejection review	9,500	2,594 (2,147)	27.3% (4.7%)
Disapproval of Registration Review (including opposition review)	174	16 (6)	9.2% (5.7%)
Invalidation declaration	3,636	680 (26)	18.7% (18%)
Cancellation review	1,398	331	23.7%
Total	14,708	3,621	24.6% (9.8%)

b. The CNIPA publicly solicits opinions on the “General Trademark Violation Judgment Standards“

To strengthen trademark management, improve trademark enforcement guidance, and unify enforcement standards, the CNIPA has drafted the “General Trademark Violation Judgment Standards (Draft for Comment) (“Standards”),” which the CNIPA publicly solicited opinions until October 1, 2021.

The Standards stipulates ten general trademark violations, including: violation of Article 6 of the Chinese Trademark Law, that is, must use a registered trademark but failed to use it; violation of Article 10(i) of the Chinese Trademark Law, that is, use logos that are not allowed to be used as a trademark; violation of Article 14(5), that is, use the words “well-known mark” during business activities; violation of Article 49(i) of the Chinese Trademark Law, that is, in the process of using the registered trademark, the registrant changes the registered trademark, registrant’s name, address or other registration matters by himself; violation of Article 52 of the Chinese Trademark Law, that is, uses unregistered trademarks as registered trademarks; violation of Article 3 of the Several Rules on the Regulation of Trademark Registration, that is, applying for trademark registration in bad faith and etc.

c. From September 1, 2021, intentional IP infringements, filing irregular patent applications, bad faith trademark applications, and serious violation of patent and trademark agency will be included in the serious violations of law and dishonest list

The Administrative Measures for Lists of Parties with Seriously Unlawful and Dishonest Acts for Market Regulation Authorities (“Administrative Measures”), passed on July 22, 2021, came into force on September 1, 2021.

Article 2 of the Administrative Measures states where a party violates laws and administrative regulations, who’s conduct has a bad nature, under serious circumstances, imposes great social harm and is subject to heavy administrative punishment by the market regulation authorities, the relevant market regulation authorities shall list violators in the Lists of Parties with Seriously Unlawful and Dishonest Acts in accordance with the provisions of the Administrative Measures, publish it through the national enterprise credit information publicity system, and implement corresponding management measures.

Article 9 of the Administrative Measures states those who commit the following illegal acts that undermine the order of fair competition, disrupt the market order and fall under the circumstances specified in Article 2 of the Administrative Measures shall be included in the Lists of Parties with Seriously Unlawful and Dishonest Acts:

• Unfair competition actions that seriously undermine the order of fair competition, such as infringing trade secrets, business slander, organizing false transactions, etc.;
• Intentional infringement of intellectual property rights; submitting irregular patent applications and bad faith trademark applications that damages the social and public interests; and engage in serious violation of patent and trademark agency.

d. China’s trademark registration cycle will be further reduced

On August 26, 2021, the CNIPA specially held a mobilization and deployment meeting to shorten the trademark registration cycle. The CNIPA pointed out that the State Council had decided that the general trademark registration cycle will be reduced to 7 months. It is one of the important measures to deepen the reform of the “delegation of administration and decentralization” (simplification of administration and decentralization, combination of delegation and regulation, and optimization of services) in the field of intellectual property rights. The CNIPA’s most important task of the year.

The CNIPA issued a notice on September 14, 2021, in accordance with the “Working Plan for Reduction of the Trademark Registration Cycle in General Situations,” stating that from September 29, 2021, the deadline for payment shall be adjusted from within 15 days from the date of receipt of the payment notice to within 7 days. If the payment is not made within the time limit, the CNIPA will not accept the application.

It can be seen from the above that the CNIPA has shortened the trademark registration cycle in an all-round and multi-stage manner, not only speeding up the formal and substantive examination, but also furthering the process in terms of processing. According to our recent experience, if it all goes well, it will take about 3 to 4 months from submission of an application to preliminary approval; and if excluding the office action for the non-standard goods and services and the payment duration, it will take as short as about one month from the issuance of official filing receipt to preliminary approval.

3. Trademark Practices Series – Bad Faith Application in China and Protection of Chinese Equivalents of Foreign Trademarks

Previously, we shared our insights on the application of bad faith clause with exemplary cases. This time, we are going to share cases to show how we identify the bad faith and how we present the evidence to convince the CNIPA and the courts to achieve favorable outcomes. In the last part of this series, Part IV, we will share cases and our suggestions on two issues, one is the impact on bad faith assessment in the event of later trademark assignment, the other is the necessity to assess bad faith if the right holder’s interests have already been protected by applying other clauses of the Trademark Law.

1. Tackling Bad Faith Trademark Applications or Registrations In China – Part III
2. Tackling Bad Faith Trademark Applications or Registrations In China – Part IV

When an oversea brand enters Chinese market, selecting a Chinese equivalent of the oversea brand is crucial because native Chinese pronounce and remember the Chinese language much easier than any foreign language. This is precisely why nearly all famous international brands have and use its Chinese equivalent names in China. Our article aims to shed light on how foreign brand owners can protect their Chinese equivalent trademarks.

1. Protection of Chinese Equivalents of Foreign Trademarks

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Weekly China Trademark News Updates

October 19, 2021

1. Starting January 1, 2022, the CNIPA will no longer issue paper trademark certificates

Recently, the CNIPA announced that starting from January 1, 2022, applicants who filed paper trademark applications will receive a “Notice of Issuing a Trademark Registration Certificate,” and the trademark registrant can use the web address and access code provided to retrieve electronic trademark registration certificate from the Trademark Office’s website. Applicants who filed trademark applications electronically can log into the Trademark Office’s online platform to view, download, and print electronic trademark registration certificate. The CNIPA will no longer issue paper trademark registration certificates.

2. Mary Kay lost in a trademark infringement and unfair competition dispute

Recently, the Zhejiang High Court rendered a second instance judgement against Mary Kay Inc. (“Mary Kay”) in a trademark infringement and unfair competition dispute. The court found that even if barcodes were scratched, such action cannot be seen as a trademark infringement because Mary Kay’s trademark right was exhausted on first sale.

Mary Kay registered the trademarks “Mary Kay in Chinese” with registration number 594710 and “MARY KAY” with registration number 1275186 in Class 3 for “cosmetics” related goods. Since Mary Kay entered China in 1995, it has continued to use and extensively publicize the said trademarks. The “Mary Kay in Chinese” trademark had relatively high fame. The defendant, Ma Shunxian, was the operator of the Taobao shop “Pink Shop Authentic Beauty Mall.” Various pictures of beauty and skin car products marks with the “Mary Kay” logo were found in the shop’s page. The shop’s front page indicated that all products sold were authentic and had explanations regarding reasons for scratched barcodes. Mary Kay sued Ma’s shop for trademark infringement and unfair competition based on the scratched barcodes to the Zhejiang Intermediate People’s Court and requested relief to immediately stop infringement actions and pay compensation for economic loss of RMB 500,000 (USD 77,971). The Zhejiang Intermediate Court found for Mary Kay and Ma appealed to the Zhejiang High Court.

The Zhejiang High Court reasoned that in a trademark infringement case, if the alleged infringing product was a genuine product, it would be an objective fact that the product originated from the right holder, although some of the barcodes and production batch numbers of the alleged infringing product that can be traced back to the dealer’s partial information were scratched, but if the seller had fully notified the code scratching, it would not harm Mary Kay’s trademark function as to identify the source of the goods, nor would it cause confusion or misunderstanding to the relevant public. It would certain not affect consumers’ perception of Mary Kay’s product and Mary Kay’s reputation. Therefore, the trademark exhaustion principle could be applied in this case and the defendant did not infringe upon Mary Kay’s trademark.

3. Ikea was awarded RMB 600,000 in compensation in a trademark infringement dispute

Recently, the Henan High Court affirmed the first instance court’s decision regarding a trademark dispute involving “Ikea in Chinese,” “Ikea,” and “Jiyou Yi Jia in Chinese.” The court found that the owner of “Jiyou Yi Jia in Chinese” infringed upon Ikea’s trademark rights and shall compensate Ikea’s economic loss of RMB 600,000 (USD93, 581).

Ikea is the right holder of the trademarks “Ikea in Chinese” with registration number 772439 and “IKEA” with registration number 772441 in Class 43 for “restaurant” related services. Ikea’s trademarks “Ikea in Chinese” had rather strong distinctiveness on restaurant related services, and had obtain relatively high fame through use. The owner of the mark “Jiyou Yi Jia in Chinese,” Henan Banmutian Co., Pengfei Lv, and Xiaoting Lv, applied for the “ikea” domain name and trademarks similar to Ikea’s registered trademarks. Additionally, they have promoted and advertised franchise opportunities on WeChat, Weibo, Tik Tok, and its website using marks that were similar to “Ikea in Chinese” and “IKEA.” Such actions would be likely to cause confusion and mistaken the relevant public, which constituted as a trademark infringement upon Ikea’s trademark rights and disturbed the normal market competition and order.

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Weekly China Trademark News Updates

October 12, 2021

1. Osram successfully invalidated the “Ou Shi Lang in Chinese” trademark

Recently, the Beijing High Court made a second-instance judgment on the invalidation of the “Ou Shi Lang in Chinese” trademark (“Disputed Mark”) with reg. no. 18331958 that rejected the CNIPA’s appeal and affirmed the first-instance court’s judgment that the Disputed Mark constituted as a similar trademark used on the same or similar goods with the cited trademark of Osram Co., Ltd. (“Osram”).

Disputed Mark	Cited Marks 1 & 4	Cited Marks 2 & 5	Cited Marks 3 & 6

The court found that: the Disputed Mark “Ou Shi Lang in Chinese” constituted as similar to the Cited Marks 1 & 4 and the Chinese portion of the Cited Marks 2 & 5 in terms of composition and pronunciation. The Disputed Mark also constituted as similar to the Cited Marks 3 & 6 because “OSRAM” corresponds to “Ou Si lang in Chinese.” The Disputed Mark’s approved goods for “video display products” did not fall into the same subclasses with the cited marks’ approved goods for “light-emitting diode, electronic bulletin board, image recording equipment, image transmission equipment, lighting equipment and devices, and lighting equipment,” but were closely associated in terms of function, sales channel, sales target, etc. Considering that the evidence can prove that the cited marks 4 & 6 enjoyed certain fame on lighting equipment, the co-existence of the Disputed Mark and the cited marks were very likely to cause confusion to the relevant public or believe that there were certain association between the goods and the source of the goods. Thus, the Disputed Mark constituted as similar marks to the cited marks on identical or similar goods. The Disputed Mark violated Article 30 of the Chinese Trademark Law. The first-instance judgment was affirmed.

2. Ralph Lauren prevailed in the second instance unfair competition dispute regarding the “POLO” logo and was awarded RMB 3 million in damages

The Beijing IP Court concluded a copyright infringement and unfair competition dispute between appellants Ralph Lauren Corporation (“RLC”), Polo/Lauren Company, LP. (“PLC”) and appellees Guangzhou Gangpai Garment Co., Ltd. (“Gangpai”), appellees Guangzhou Huaren Garment Industry Co., Ltd. (“Huaren”), Beijing Dahongmen Fuhai International Trading Co., Ltd. (“Fuhai”) which revoked the first-instance decision and ordered Gangpai and Huaren to stop use PLC’s corporate name and compensate PLC RMB 3 million in damages and RMB 100,000 in reasonable litigation expenses.

The Beijing IP Court found the following facts in its judgment:

Regarding the first issue, whether the three appellees infringed the two appellants’ copyrighted art works. The two appellants claimed that the artworks involved in this case should be protected by the Copyright, and the two appellants enjoyed the copyright of the artwork, however, there were excessive differences between the racket swinging movements, riding gestures between the accused horse-riding logo and the artwork involved in this case, which did not constitute as similar. The two appellants’ claims that the three appellees infringed its copyright could not be supported. The first-instance court’s decision should be affirmed.

Regarding the second issue, whether the three appellees’ use of the appellants’ packaging and decoration amounted to unfair competition. The two appellants claimed the packaging features of gold metal hooks and wooden hangers, cardboard shopping bags, belt packaging boxes, and a series of its decoration features were existing and common designs in the apparel industry that did not have distinctive features compared to other similar goods. The claimed features did not constitute as packaging or decoration under the Anti-Unfair Competition Law of China (“AUCL”) and the two appellants’ claims shall not be supported. The first-instance court’s decision should be affirmed.

Regarding the third issue, whether the accused Gangpai used unfair means to imitate the two appellant’s well-known trademarks amounted to unfair competition. There are express provisions in the Chinese Trademark Law on the two appellants’ accusations, and according to the legislative intent of the AUCL, the specific law that regulated the alleged action should be applied over the AUCL. The two appellants’ claims shall not be supported.

Regarding the fourth issue, whether the three appellees use the two appellants’ corporate names without authorization amounted to unfair competition. First, before the infringement of its corporate name, the two appellants continued to promote and use the “POLO” logo on clothing products in China through media reports and the establishment of retail stores. The “POLO” logo enjoyed very high reputation among the relevant public in China. “POLO” was the main part of the trade name that the two appellants have been using since their establishment. According to the relevant public’s long-term exposure of the term “POLO,” the relevant public was accustomed to using the “POLO” logo to refer to the appellants, which constituted as the abbreviation of the appellants’ corporate name. Therefore, “POLO,” as the appellants’ name and abbreviation, should be protected under the AUCL. Second, the appellants accused the Gangpai and Huaren of unauthorized use of the infringement marks “LEYUDN POLOPOS,” “POLO SIMON, “POLO SIMON,” and “Paul Simon in Chinese & POLO SIMON.” Gangpai and Huaren argued that these were legally registered trademarks, however, these marks were invalidated by the people’s courts. According to Article 47 of the Chinese Trademark Law 2019 and Article 30 of the Provisions of the Supreme People’s Court on Several Issues Concerning the Trial of Administrative Cases for the Authorization and Confirmation of Trademarks (Amended in 2020), the above-mentioned trademarks were not protected by the exclusive right to use from the beginning. Therefore, Huaren’s arguments were untenable. Third, the accused clothing products such as T-shirts, casual pants, belts, etc. were identical or similar to the appellants’ famous clothing products; the alleged infringing luggage had strong relevance to clothing goods in terms of function, use, sales channels, target consumer, etc., especially in this case, where these products were all placed and sold in the same retail store, which had caused consumers to be confused, bought and misidentify the goods. Thus, the alleged infringing goods constituted as similar goods. The use of “LEYUDN POLOPOS,” “POLO SIMON,” “POLO SIMON,” “Paul Simon POLO SIMON,” and other marks containing the words “POLO” on the above-mentioned accused infringing goods constituted as similar to the appellants’ corporate name “POLO” in terms of overall visual appearances, which was likely to cause the relevant public to misidentify and constituted as use other’s corporate name as goods without authorization. According to the corporate name marked on the packaging and tag of the infringing goods, it can be determined that Huaren was the manufacturer and seller of the goods, and Gangpai was the authorized licensor of the infringing mark. The company registry of Gangpai showed that its legal representative was former Huaren shareholder and supervisor, which proved its association. Therefore, Gangpai and Huaren shall be jointly and severally liable. Consider that when the alleged infringement occurred, RLC’s corporate name did not include the “POLO” logo, the claim of unauthorized use of its company name were not supported, that is, the court only found that Gangpai and Hauren’s use of PLC amounted to unfair competition. Gangpai and Huaren were ordered to stop using the infringing logo, to publish news to eliminate negative impacts, and to compensate for losses. The first-instance judgment erred in application of law and this court amended.

Regarding the issue of compensation for losses, since PLC did not provide direct evidence of the actual losses suffered due to the infringement and the infringer’s gains due to the infringement, the court referred to the duration of the infringement involved, scope of implementation of the infringing actions, sales price of infringing goods, and other subjective infringing factors to ascertain an economic compensation within the scope of statutory compensation. Especially considering the fact that the official website of the Gangpai introduced that “the brand “POLOSIMON” has been created since 2010, and there are nearly a hundred stores across the country,” it can prove that its infringement duration was long and the profits were huge; Gangpai has never applied for the registration of a separate “POLO” word mark, but clothing displayed in its business premises has a separate “POLO” logo, and its official website emphasized that its products “incorporate American style,” which proved that the Gangpai had obvious bad faith in taking advantage of other’s goodwill. Although the appellants filed a separate lawsuit against Huaren and Gangpai’s infringement of its trademark rights and claimed financial compensation, the above facts were sufficient to prove that Huaren and Gangpai have made huge profits from the infringement and its gains obviously exceeded the amount of economic compensation claimed by the appellants. Therefore, the Beijing IP Court fully supported PLC’s economic compensation. At the same time, supported the appellants’ request for reasonable litigation expenses including notarization fees, copy fees, and lawyer fees.

Since Fuhai was a marketing organizer, the existing evidence proved that it has fulfilled its duty of reasonable duty in selling the alleged infringing goods to the merchants, and had no subjective fault, so it shall not assume legal responsibility.

3. The decoration of “Yuan Qi Sen Lin” shall be protected and Yuan Qi Sen Lin was awarded RMB 650,000 in damages

The Beijing IP Court concluded a second-instance unfair competition judgement involving appellants Yuan Qi Sen Lin (Beijing) Food Technology Group Co., Ltd. (“Yaun Qi Sen Lin”), Zhejiang Quanshui Dingdong Food Co., Ltd. (“Quanshui Dingdong”) and appellees Beijing Jingdong Sanbailushi Du E-Commerce Co., Ltd. (“JD.com”) and Zhejiang Tmall Network Co., Ltd. (“Tmall”) that rejected the appellants’ appeal and affirmed the lower court’s decision.

Regarding the first issue, whether Yuan Qi Sen Lin’s products constituted having certain influential product name, packaging, and decoration. The Beijing IP Court found that starting from June 2018, Yuan Qi Sen Lin has promoted its products through various online and offline methods to make its products known to the relevant public in a relatively short period of time. According to the notarization and audit submitted by Yuan Qi Sen Lin and other evidence can prove that Yuan Qi Sen Lin’s products had a large sales volume before July 2019 and were highly ranked. Therefore, based on the sales, the duration, extent, and geographic scope of its products, its products can be deemed to have a certain impact. According to the first-instance’s fact findings of the packaging and decoration of Yuan Qi Sen Lin’s products, its products were unique in design, fonts, color, shape, arrangement and combination. The evidence was insufficient to prove that the packaging and decoration have been commonly used by relevant products. As mentioned, after the continuous promotion of Yuan Qi Sen Lin, the relevant public has assocaited the products that use its packaging and decoration with Yuan Qi Sen Lin, which has the function of identifying the source of the goods, and can be regarded as the distinctive packaging and decoration of Yuan Qi Sen Lin’s products.

Regarding the second issue, whether the alleged infringement of Quanshui Dingdong amounts to unfair competition. The packaging and decoration of Quanshui Dingdong’s products were highly similar to Yuan Qi Sen Lin’s products in terms of color, main composition of pattern, layout, product text introduction, and shape. Although there were differences in details, there was no obvious overall differences, which was likely to cause confusion to the relevant consumer. Therefore, the first-instance court did not err in finding that Quanshui Dingdong’s actions amounted to unfair competition.

Regarding the question of whether the amount of compensation ordered in the first-instance judgment is reasonable, since Yuan Qi Sen Lin and Quanshui Dingdong did not submit sufficient evidence to prove Yuan Qi Sen Lin’s actual losses and Quanshui Dingdong’s infringement profits, the first-instance court comprehensively considered the degree of fame, operation duration, scope, and sales methods of Yuan Qi Sen Lin’s products, and the subjective fault of Quanshui Dingdong, its operation duration, scale, and sales in ascertaining that Quanshui Dingdong shall compensate Yuan Qi Sen Lin for economic loss of RMB 650,000 (USD 101,000) was appropriate. Moreover, it is not inappropriate for the first-instance court to support Yuan Qi Sen Lin’s claim of a reasonable enforcement expenses of RMB 70,000 (USD 1,087).

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

Weekly China Trademark News Updates

September 28, 2021

1. The Beijing High Court: Trademark co-existence agreement does not automatically equal to grant of trademark protection

Volkswagen applied the “TAYRON” mark with application number 30191626 which was blocked by the prior registered trademark “TYRON” with registration number 1613996. Volkswagen submitted a trademark co-existence agreement issued by the owner of the prior trademark, however, the Beijing High Court found that the disputed mark “TAYRON” was almost identical to the prior trademark “TYRON,” thus, even if the co-existence agreement is legal, authentic, and effective, it would not be enough to eliminate the possibility to confuse or to mislead the relevant public regarding source of the goods. Therefore, the trademark co-existence agreement could not be the basis for the registration of the disputed mark “TAYRON” and the court rejected Volkswagen’s appeal.

2. “Coffee-mate in Chinese” vs “Kafei Banlv in Chinese” – a strict standard should be applied to the exclusive right of a trademark with weak distinctiveness

Nestlé sued the infringing use of the “Kafei Banlv in Chinese” mark by Kunming Hougu Coffee Sales Co., Ltd. (“Hougu”) based on its exclusive right to use the registered trademark “Coffee-mate in Chinese.” After the first instance, second instance, and retrial of the case, the Beijing High Court upheld the judgments of the first and second instance courts and rejected Nestlé’s application for retrial. The Beijing High Court found that Nestlé’s ” Coffee-mate in Chinese” trademark has weak distinctiveness. Based on this, the first instance court was not inappropriate to apply a strict standard to the protection scope of the exclusive right of the “Coffee-mate in Chinese” trademark. While Nestlé’s extensive use and publicity of the “Coffee-mate in Chinese” logo will increase the popularity of the “Coffee-mate in Chinese” trademark, but it will weaken the trademark’s function to identify the source of the goods and compromised its distinctiveness. Such increase in popularity and expansion of the various use of the trademark did not have a positive impact on the trademark’s distinctiveness. The “Coffee-mate in Chinese” logo itself is relatively weak. Meanwhile, there were certain differences in the text composition between the “Coffee-mate in Chinese” logo and the “Kafei Banlv in Chinese” logo. Hougu also used the “Kafei Banlv in Chinese” logo and marked it in bold. The relevant public can distinguish between the two marks, thus “Kafei Banlv in Chinese” did not infringe Nestlé’s exclusive right to the registered trademark ” Coffee-mate in Chinese.”

3. The Beijing IP Court: “Xiao Guan Cha in Chinese” obtained distinctiveness through use

Changzhou Kaigu Tea Food Co., Ltd. (“Kaigu”) filed a trademark invalidation of against “Xiao Guan Cha in Chinese” with registration number 20426843 in Class 30 owned by Beijing Xiao Guan Cha Co., Ltd. for lack of distinctiveness and other grounds. The Beijing Intellectual Property Court found that the use of the “Xiao Guan Cha in Chinese (translated to ‘small can tea’)” trademark on “tea; flowers or leaves used as a substitute for tea; tea beverages; ice tea” and other goods directly indicated the main raw materials and the packaging of the goods, which lacked the inherent distinctiveness that a trademark should have. The disputed trademark should not have been granted according to Article 11(I)(ii) of the Chinese Trademark Law. However, consider the distribution contracts and invoices submitted by the registrant, the honors received, the advertising contracts, media reports, market research reports, advertising audit reports and other materials, as well as the facts confirmed in multiple civil judgments, the Beijing Intellectual Property Court found that the evidence in the case can be used to find that the “Xiao Guan Cha in Chinese” trademark had a relatively high reputation among the relevant public, and had formed a corresponding relationship with the registrant. The “Xiao Guan China in Chinese” trademark had obtained distinctiveness through use and can be used to distinguish the source of goods. Therefore, according to Article 11(II) of the Chinese Trademark Law, the “Xiao Guan Cha in Chinese” trademark can be registered as a trademark.

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

Ms. Yan Zhang, the partner of Beijing East IP Law Firm, participated as a presenter at Strafford live video webinar “Trademark Doctrine of Foreign Equivalents” on September 15, 2021. Brett Heavner, the partner of Finnegan, Henderson, Farabow, Garrett & Dunner, LLP and Yinfei Wu, the attorney of Finnegan, Henderson, Farabow, Garrett & Dunner, LLP also joined in the panel. The panel examined the doctrine of foreign equivalents in the context of trademark prosecution, clearances and trademark infringement in different languages, also reviewed recent cases and discussed the lessons from those decisions.

Ms. Zhang started with the explanation on Chinese equivalents of foreign language trademarks, and then discussed the importance and urgency of trademark protection of Chinese equivalents. Based on examination practices of the Chinese Trademark Office and courts applying the doctrine of foreign equivalents, Ms. Zhang further summarized the factors and criteria of judging the similarity between foreign language trademarks and Chinese equivalents in prosecution and litigation.

As for the protection of Chinese equivalents of foreign language trademarks in China, it is quite common that oversea brand owners do not have “official” translations for foreign language trademarks, nor do they use and promote the trademarks in Chinese. Chinese distributors, public and media often use Chinese versions to refer to brand owners. Ms. Zhang shared her experiences from multiple perspectives, such as passive use, distributors’ squatting, brand owners denying corresponding Chinese equivalents, sufficiency of evidence and time of evidence formed. By combining with the specific cases represented, Ms. Zhang elaborated some issues and lessons regarding the corresponding relationship between foreign language trademarks and Chinese equivalents, and provided practical advices for oversea brand owners doing business in China.

Strafford is a leading continuing education provider offering CLE and CPE webinars presented by renowned professionals in the legal, corporate tax, accounting and tax return preparer professions. For the details of programs, please refer to

https://www.straffordpub.com/products/tlhptdekna?utm_campaign=tlhptdekna

Ms. Yan Zhang, the partner of Beijing East IP Law Firm, gave a keynote speech on “Strategy on how to respond to bad faith trademark registration and malicious lawsuit” at an online seminar hosted by the US-China Business Council (USCBC) on June 17, 2021.

Ms. Zhang analyzed the problems of trademark squatting in China, and discussed about the legal regulations on trademark squatting under the fourth revision of the Chinese Trademark Law. Ms. Zhang further shared the views and strategies on how to respond to bad faith trademark registration and malicious lawsuit from the perspectives of administrative and civil proceedings.

As for the legal regulations on trademark squatting, Ms. Zhang summarized the applicable requirements of relevant legal provisions, presented the specific cases represented by our firm, and discussed the factors of determining bad faith trademark registration in judicial practices.

As for the malicious lawsuits initiated by trademark squatters, Ms. Zhang shared her experiences from multiple perspectives, such as responding to online platform complaints and Customs seizures, negotiations and settlements. By combining with the specific cases represented, Ms. Zhang elaborated in detail the strategies of defense against trademark infringement and claim for the declaratory judgment for non-infringement, and further provided valuable practical advices for enterprises to respond to malicious lawsuits.

In the question-and-answer session after the speech, Ms. Zhang actively answered questions from participants, and communicated with participants on hot topics such as evidence preservation and damages in intellectual property litigation, and won unanimous praise from the organizers and participants.

The USCBC is a private, nonpartisan, nonprofit organization of over 200 American companies that do business with China. Founded in 1973, the USCBC has provided unmatched information, advisory, advocacy, and program services to its members for over four decades. Through its offices in Washington, DC, Beijing, and Shanghai, the USCBC is uniquely positioned to serve its members’ interests in the United States and China. For the details of activities, please refer to

https://www.eventbrite.com/e/protecting-your-ip-in-china-early-stage-ip-strategy-planning-and-litigation-registration-157460074321

Weekly China Trademark News Updates

September 22, 2021

1. China’s trademark registration cycle will be further reduced

On August 26, 2021, the CNIPA specially held a mobilization and deployment meeting to shorten the trademark registration cycle. The CNIPA pointed out that the State Council had decided that the general trademark registration cycle will be reduced to 7 months. It is one of the important measures to deepen the reform of the “delegation of administration and decentralization” (simplification of administration and decentralization, combination of delegation and regulation, and optimization of services) in the field of intellectual property rights. The CNIPA’s most important task of the year.

The CNIPA issued a notice on September 14, 2021, in accordance with the “Working Plan for Reduction of the Trademark Registration Cycle in General Situations,” stating that from September 29, 2021, the deadline for payment shall be adjusted from within 15 days from the date of receipt of the payment notice to within 7 days. If the payment is not made within the time limit, the CNIPA will not accept the application.

It can be seen from the above that the CNIPA has shortened the trademark registration cycle in an all-round and multi-stage manner, not only speeding up the formal and substantive examination, but also furthering the process in terms of processing. According to our recent experience, if it all goes well, it will take about 3 to 4 months from submission of an application to preliminary approval; and if excluding the office action for the non-standard goods and services and the payment duration, it will take as short as about one month from the issuance of official filing receipt to preliminary approval.

2. CNIPA Issued the Reply on Whether the Shape of Goods Consistent with the Graphics of Registered Trademarks of Similar Goods Constitutes Infringement of Right to the Exclusive Use of the Registered Trademark

On September 8th, 2021, the CNIPA issued a reply on ” Whether the Shape of Goods Consistent with the Graphics of Registered Trademarks of Similar Goods Constitutes Infringement of Right to the Exclusive Use of the Registered Trademark“:

The CNIPA concluded that the two trademarks of Chanel and Van Cleef & Arpels have high reputation and distinctiveness and have formed a unique correspondence with the right holders. The relevant consumers have also closely associated the trademarks with the right holders. The use of the trademark design as the shape of goods actually has the function of identifying the source of the goods, which is likely to cause the relevant public to confuse the source of the goods. Such action constituted as using other’s registered trademarks or similar logos as the name or design of goods on identical or similar goods under Article 76 of the Implementation Guideline of the Trademark Law. If the action misleads the relevant public, it shall be deemed as infringing other’s exclusive trademark right under Article 57, Paragraph 2 of the Chinese Trademark Law.

3. The mark “MOPIDICK in Traditional Chinese” was maintained on cosmetic goods

IKEDA MOHANDO CO., LTD. (“IKEDA”) registered the trademark “” with registration no. 9945049 on August 28, 2014, in Class 3 for “cosmetics; soaps; fragranced soaps; fragrances; cosmetic nails; cosmetic eyelashes; perfume; toothpaste.”

A natural person filed a non-use cancellation and later a cancellation appeal against said mark. The CNIPA concluded that the evidence submitted by IKEDA showed that the disputed trademark was used on anti-mosquito and anti-itch liquid products, which were closely related to cosmetic products in function, sales location, consumer, etc., and the trademark shall be maintained on cosmetic goods. However, the evidence did not show that the disputed trademark was used for soaps; fragranced soaps; fragrances; cosmetic nails; cosmetic eyelashes; perfume; and toothpaste, and the mark’s registration on these goods shall be cancelled accordingly.

IKEDA appealed to the Beijing Intellectual Property Court and the court found that the online sales and publicity evidence submitted by IKEDA could prove that it had actually used the disputed trademark on the “anti-mosquito and anti-itch liquid” products within the specified period. In view of the strong correlation between the “anti-mosquito and anti-itch liquid” products and the “cosmetics” goods approved for the disputed trademark in terms of function, use, sales location, and consumers, the disputed trademark shall be maintained on the “cosmetics” goods. According to the Classification of Similar Goods and Services, “fragrance, cosmetic nails, cosmetic eyelashes, soap, fragranced soap” and “cosmetics” goods belong to the same subclass, and the disputed trademark shall be maintained on these goods as well. In addition, the disputed trademark’s approved goods of “toothpaste, perfume” and “cosmetics, soaps, fragrance” were all daily washing and chemical goods, and they were highly similar in terms of function and use, production department, sales channel, and consumers. According to Article 2 of the Regulations on Hygiene Supervision of Cosmetics and relevant regulations, cosmetics refer to daily chemical industrial products that are spread on skin, hair, nails, lips and other parts of the human body by wiping, spraying or other similar methods to achieve the purposes of cleaning, eliminating bad smell, skin care, beauty and decoration. Therefore, the dispute trademark’s approved use of “toothpaste and fragrance” products should also be covered by cosmetics in terms of function and use. Therefore, “toothpaste and fragrance” and “cosmetics” should be deemed as similar goods, and the disputed trademark’s approved use for “toothpaste and fragrance” shall be maintained.

The CNIPA appealed the first instance decision to the Beijing High Court. The Beijing High Court recently affirmed the first instance court decision that the disputed trademark “MOPIDICK in Traditional Chinese” shall be maintained for its registration on cosmetics, toothpastes, fragrances and other designated goods.

4. Unilever successfully invalidated the “OMO in Chinese” mark in Class 11 with its well-known mark recognition

Wuxi Lianhua Daily Use Technology Co., Ltd. (“Wuxi Lianhua”) registered the “” mark with registration number 12156179 (“Disputed Trademark”) on September 7, 2014 for “electric heating devices; heating plates; burners; evaporators” and other goods in class 11. Unilever filed an invalidation request against the Disputed Trademark, citing multiple registered trademarks of “” and “” in Class 3. The CNIPA maintained the Disputed Trademark as it found that the Disputed Trademark’s approved goods of heating devices, etc. were quite different from the cited trademark’s approved goods for “washing powder, laundry (agents) detergent and ingredients,” and did not support Unilever’s well-known mark claims.

Unilever was dissatisfied and appealed to the Beijing Intellectual Property Court. The court held that the Disputed Trademark was identical with the Chinese characters of the cited trademarks but did not form a new meaning that was clearly different from the cited trademarks, which constituted an imitation of the cited trademarks. The Disputed Trademark’s approved goods “electric heating device; heating plate” and the cited trademarks’ approved goods “detergent; washing powder; laundry detergent” were all consumer goods. Using the Disputed Trademark on “electric heating device; heating plate” could easily let the relevant public associate Unilever’s cited trademarks. The Disputed Trademark improperly took advantage of reputation built by Unilever’s long-term promotion of its cited trademarks, which damaged Unilever’s well-known trademarks. Therefore, the Disputed Trademark’s registration constituted the situation stipulated in Article 13 Paragraph 3 of the Chinese Trademark Law 2014.

The CNIPA was unsatisfied and appealed to the Beijing High Court. The second instance court found in the final judgment that: although the “electric heating device; heating plate” and other goods approved for use under the Disputed Trademark and the approved goods of “washing powder and detergent” that the cited trademarks were well-known for were not identical or similar goods according to the Classification of Similar Goods and Services, but there was a large range of overlap in sales channels, consumers, etc. Where Unilever’s “OMO and OMO in Chinese” trademarks have been widely known to the public, the Disputed Trademark’s registration and use on its approved goods would likely to mislead the public that the Disputed Trademark was associated with the cited trademarks., which would decrease the distinctiveness of Unilever’s well-known trademarks. Meanwhile, Wuxi Lianhua’s evidence failed to support that the Disputed Trademark had obtained stable corresponding relationship with the approved goods through promotion and use. Thus, the Disputed Trademark’s registration may have improperly taken advantage of the cited trademarks’ market reputation and damaged Unilever’s interests. Accordingly, the first instance’s decision shall be affirmed.

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

Weekly China Trademark News Updates

September 14, 2021

1. Amazon’s “AWS” trademark was rejected in the second instance

On September 1, 2021, the Beijing High Court rejected Amazon’s appeal and affirmed the first instance court’s decision on Amazon’s “AWS” trademark application in Class 35.

On September 5, 2017, Amazon applied for “AWS” mark with application number 26231153 designated in Class 35 for “business consulting; business data analysis; data processing services; providing online market for buyers and sellers of goods and services; business management and organization consulting.” The CNIPA refused the “AWS” mark for registration citing prior similar marks. Amazon was unsatisfied and appealed the decision to the first instance court.

Disputed Mark	Cited Mark 1	Cited Mark 2

On September 1, 2021, the Beijing High Court found that first, as the time of the second instance trial, the cited mark 1 was still a prior valid registered trademark, which could block the Disputed Mark’s registration. Second, according to the effective administrative judgment no. 1611 made by this court, the Cited Mark 2 in this case has made an actual, legal, and effective commercial use in its approved services of “systematization of computer database information, incorporation of information into computer database.” The Cited Mark 2’s registration in the above services should be maintained. Accordingly, the Cited Mark 2 also constituted as a prior right obstacle to the Disputed Mark. Third, in view of Amazon’s explicit recognition in the original trial that the services designated for the use of the Disputed Mark and the services approved for the use of the Cited Mark 2 constituted the same or similar services, this court confirmed such facts after examination. The Disputed Mark was composed of the English letters “AWS,” which was similar to the Cited Mark 1 and Cited Mark 2 “AWS” in letter composition, pronunciation, etc., and there were no obvious overall differences between the marks. At the same time, when used in the same or similar services, it was easy for the relevant public to associate that the marks were from the same entity or they were serial marks, or that there was certain special relationship between the trademark owners, so as to misidentify the source of the services. Therefore, the first instance court did not err in finding that the Disputed Mark’s application violated Article 30 of the Chinese Trademark Law 2013.

2. The Suzhou Intermediate Court ordered RMB 15 million in compensation for bad faith trademark filings and trademark hoarding

Recently, the Suzhou Intermediate Court concluded a trademark infringement and unfair competition dispute case, and ordered RMB 15 million (USD 2.3 million) in damages against a household furnishing company in Fujian (hereinafter referred to as the “Fujian Company”).

Big Nature Home (China) Co., Ltd. (“Nature Company”) is the owner of multiple registered trademarks such as “Big Nature in Chinese” and “Nature.” The Fujian Company applied for the “Big Nature Aesthetician in Chinese” mark and created the WeChat public account of ” Big Nature Aesthetician Flooring.” In the WeChat account, 46 franchised stores were listed and the “” mark was used on the franchise page. Meanwhile, the Fujian Company  registered the “naturemxj.com” domain name and used logos such as “Big Nature Aesthetician” and “Nature Mxj” in many places in its shops. In addition, the Fujian Company has applied for registration of 50 trademarks for goods/services in different Classes, 36 of which were submitted on the same day.

At the beginning of 2020, Nature Company filed a lawsuit to the court, demanding that Fujian Company immediately stop the infringement and compensate RMB 15 million for losses. The court held that the alleged infringing marks were similar to Nature Company’s trademark in terms of text, pronunciation, overall color matching, and visual effects, which could easily cause the relevant public to misunderstand the source of the goods or believe that it had a specific association with Nature Company’s products. Thus, it constituted as trademark infringement. At the same time, when the Fujian Company was established, the Nature Company’s trademarks already had high reputation and influence. As a business in the same industry, the Fujian Company registered words containing the infringing mark as its corporate name and deliberately taking advantage of Nature Company’s fame, caused confusion to the relevant consumers and amounted to unfair competition. In addition, the Fujian company deliberately registered a domain name similar to the Nature Company’s trademark and used the website to engage in corresponding commercial promotion activities, which was enough to cause the relevant public to misidentify the owner of the website or believe that the website has a special licensing relationship between the Nature Company and the Fujian Company, which amounted to unfair competition and violated the good faith principle and should be prohibited. This case is a malicious infringement with serious circumstance, and it meets the applicable conditions of punitive damages. In this case, punitive damages is doubled and the Nature Company’s claim of RMB 15 million is fully supported.

3. The Beijing Intellectual Property Court held a briefing on penalties involving perjury in administrative cases of trademark cancellation appeal

On September 10, 2021, the Beijing Intellectual Property Court (Beijing IP Court) held a briefing on penalties involving perjury in administrative cases of trademark cancellation appeal. At the meeting, the Beijing IP Court released the relevant status of the trial of administrative cases of trademark cancellation appeal, the main methods of regulating perjury in such cases, and related suggestions to further strengthen the protection of the entire chain of intellectual property rights.

Since 2019, the Beijing IP Court has concluded 40,114 trademark authorization and confirmation cases, of which 3,843 trademark cancellation appeal cases have been concluded, accounting for 9.6% of all trademark authorization and confirmation cases. Among them, a total of 970 cases were cancelled by the CNIPA with a cancellation rate of 27.7%. Regarding trademark registrants who submitted forged evidence of trademark use and falsified facts of trademark use, the Beijing IP Court has ordered punitive decision against these trademark registrants.

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

Weekly China Trademark News Updates

September 7, 2021

1. “NEW BALANCE” ousted “New bunren”

On August 13, 2021, the Beijing High Court affirmed the first instance court decision in favor of the CNIPA over a trademark invalidation dispute.

Disputed Mark	Cited Mark

The Disputed Mark was approved for registration on January 7, 2011, and New Balance filed an invalidation petition on June 28, 2018, after the five-year statute of limitation on filing an invalidation petition against a registered trademark. The CNIPA, however, found that the Disputed Mark constituted as maliciously imitating other’s well-known registered trademark under Article 13(3) of the Chinese Trademark Law, and concluded that New Balance’s invalidation petition was not limited by the five-year statue of limitation.

The Beijing High Court affirmed the first instance court decision finding that New Balance had submitted sufficient evidence proving that the Cited Mark was widely known and enjoyed high fame among the relevant public on “shoes” related goods and constituted as a well-known mark.

Article 13(3) of the Chinese Trademark Law protects well-known trademarks in China and is applicable to registered trademarks. The legislative intention of Article 13(3) is to provide stronger protection to well-known trademark than general registered trademarks. If identical or similar trademarks are registered or used on identical or similar goods approved for the well-known trademark, the consequential damage on the well-known trademark are obviously higher than those trademarks registered or used on different or dissimilar goods. Therefore, applying for trademark registration by copying, imitating, and translating other’s registered well-known trademark on “identical or similar goods” shall be regulated by Article 13(3).

In this case, both the Disputed Mark and the Cited Mark contained “NEW,” while the pronunciation of “BALANCE” and “bunren” was similar, thus, the Disputed Mark and the Cited Mark were similar in terms of word compositions, pronunciations, overall appearances, and visual effects. The Disputed Mark constituted as an imitation of the Cited Mark. The goods approved for the Disputed Mark were identical or similar to the shoes related goods approved under the Cited Mark in terms of function, use, production department, sales channels, consumers, etc., which constituted as identical or similar to the Cited Mark’s approved goods. Where the cited trademark has constituted a well-known trademark and the Disputed Mark is an imitation of the Cited Mark, when purchasing goods approved for use by the Disputed Mark, the relevant public would easily believe that such goods had certain association with the Cited Mark, which would weaken the Cited Mark’s distinctiveness and damage New Balance’s interests obtained through its well-known Cited Mark. The Court concluded that the Disputed Mark violated Article 13(3) and shall be invalidated.

2. From September 1, 2021, intentional IP infringements, filing irregular patent applications, bad faith trademark applications, and serious violation of patent and trademark agency will be included in the serious violations of law and dishonest list

The Administrative Measures for Lists of Parties with Seriously Unlawful and Dishonest Acts for Market Regulation Authorities (“Administrative Measures”), passed on July 22, 2021, came into force on September 1, 2021.

Article 2 of the Administrative Measures states where a party violates laws and administrative regulations, has a bad nature, under serious circumstances, imposes great social harm and is subject to heavy administrative punishment by the market regulation authorities, the relevant market regulation authorities shall list violators in the Lists of Parties with Seriously Unlawful and Dishonest Acts in accordance with the provisions of the Administrative Measures, publish it through the national enterprise credit information publicity system, and implement corresponding management measures.

Article 9 of the Administrative Measures states those who commit the following illegal acts that undermine the order of fair competition, disrupt the market order and fall under the circumstances specified in Article 2 of the Administrative Measures shall be included in the Lists of Parties with Seriously Unlawful and Dishonest Acts:

1. Unfair competition actions that seriously undermine the order of fair competition, such as infringing trade secrets, business slander, organizing false transactions, etc.;
2. Intentional infringement of intellectual property rights; submitting irregular patent applications and bad faith trademark applications that damages the social and public interests; and engage in serious violation of patent and trademark agency.

3. The State Administration for Market Regulation published the draft of “the Decision on Revising the E-Commerce Law of China (Draft to solicit public opinion)” for comments

On August 31st, the State Administration for Market Regulation published on its website and WeChat account the draft of “the Decision on Revising the E-Commerce Law of China (Draft to solicit public opinion),” and the deadline for feedback is October 14, 2021.

Among them, Article 43 is amended as: “upon receiving the notice of transfer, business operators who use the e-commerce platform may submit a non-infringing statement to the operator of the e-commerce platform that there is no infringement. The statement shall include prima facie evidence that there is no infringement.

After receiving the statement, the operator of the e-commerce platform shall transmit the non-infringing statement to the intellectual property right holder who sent the notice, and inform him that he can file a complaint with the relevant department or bring a lawsuit to the people’s court. If the operator of the e-commerce platform does not receive the notice of complaint or notice of infringement within 20 working days after the transfer statement was sent to the intellectual property right holder, the operator of the e-commerce platform shall timely terminate the measures taken.

The operators within the e-commerce platform shall provide corresponding guarantees to ensure compensation for losses caused by potential intellectual property infringement, and the operators of e-commerce platform can temporarily suspend the measures taken.

If the operator within the e-commerce platform submits a false statement that there is no infringement, resulting in the expansion of the loss of the intellectual property right holder, the operator’s liability of compensation shall be doubled.

The above amendments have the following purposes: first, to extend the waiting period after the counter notice transferred from the e-commerce platform operator to the operator within the e-commerce platform from 15 days to 20 business days. Second, in order to alleviate the possible transaction losses caused by the long waiting period for the counter notice, a provision is added: if the operator within the platform provides a guarantee to compensate for the losses caused by potential intellectual property infringement, the operator of the e-commerce platform can temporarily suspend the measures taken. Third, another new provision states that if the operator within the platform submits a false statement that there is no infringement, resulting in the expansion of the loss of the right holder, the liability of compensation of the operator within the platform shall be doubled.

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Weekly China Trademark News Updates

August 31, 2021

1. Universal Pictures prevailed in the “Minions” copyright dispute with RMB 5.1 million in compensation

Recently, the Jiangsu High Court rendered a favorable decision for Universal Pictures against defendants Cangzhou Qianchixue Food Co., Ltd. (“Qianchixue”), Jingbaojiang, Jingshusong, Wangzi Beverage (Guangzhou) Group Co., Ltd. (“Wangzi”), Guangdong Tainiu Vitamin Beverage Co., Ltd. (“Tainiu”), Wuxi Weiwei in a copyright dispute involving the “Minions” copyright. The court affirmed the first instance court’s decision and ordered the defendants, except Wuxi Weiwei, to pay RMB 5 million (USD 788,400) altogether and ordered Wuxi Weiwei to separately spay RMB 100,000 (USD 15,458) in compensation to Universal Pictures.

Universal Pictures is a world-renowned film and television studio. After being released in China, the Minions film series gained enormous reputation. Without the authorization of Universal Pictures, Qianchixue mass-produced and sold dairy beverages with a graphic that was substantially similar to the “Minions” in large quantities. Before the alleged infringing products were put on the market, other beverage companies had obtained authorization to use the Minions image from Universal Pictures. Qianchixue’s infringing products affected the sales of licensed products by other legal licensees. The court ruled that although the alleged infringing image used by the alleged infringing product was slightly different from the artwork involved, it included many main original features of the Minions, which constituted as substantially similar.  Without the permission of Universal Pictures, Qianchixue used the involved artwork on the alleged infringing products, manufactured, sold, publicized and promoted the alleged infringing products, infringing the reproduction and distribution right of the involved artwork. The defendants Jingbaojiang and Jingshusong facilitated Qianchixue’s alleged infringing activities, which constituted as joint infringement. The defendants, Tainiu and Wangzi, as the trademark owners and licensees of the alleged infringing products involved in the case, had a close interest and cooperation relationship with Qianchixue, which constituted joint infringement. Wuxi Weineng sold the alleged infringing products online, which constituted as infringement, and was ordered to separately compensate Universal Pictures for RMB 100,000 (USD 15,458).

2. Slimming tea is not tea

Recently, the trial of the administrative dispute over the cancellation review of the trademark “Tai Tai” owned by Tai Tai Health Products (Hong Kong) International Group (hereinafter referred to as “Tai Tai Group”) was concluded. The “Tai Tai” trademark with registration numbers 8144227 (“Disputed Mark”) owned by the Tai Tai Group was approved for registration on May 21, 2011, for “tea, tea substitutes” goods. A third party filed a three-year non-use cancellation against the Disputed Mark on May 31, 2017, and the CNIPA ruled in favor of the third party to cancel the Disputed Mark. Tai Tai Group appealed to the Beijing High Court but on August 9, 2021, the Beijing High Court rendered a second instance judgment dismissing the appeal and affirmed the first instance judgment.

The Beijing High Court found that although Tai Tai Group provided evidence of use that Changzhou Kaigu Tea Food Co., Ltd., the licensee of the Disputed Mark, actually sold Tai Tai Sakura Five Elements Tea, Tai Tai Xiuxiu Tea (roudi slimming tea), Tai Tai Roudi Slimming Tea, Tai Tai Xiuxiu Slimming Tea products, these products are health products and were obviously different from the “tea, tea substitute” goods in terms of raw materials, functions, uses, consumer, etc., so using the Disputed Mark on the above-mentioned products could not be deemed as use on the “tea, tea substitute.”

In this case, the Beijing High Court clearly pointed out that “slimming tea” is a health product, not a “tea, tea substitute” goods under Subclass 3002, which has a guiding effect on similar cases. This decision also puts forward clearer requirements in regulating companies’ use of their trademarks.

3. The CNIPA rejected trademark applications for Olympian gold medalists’ name

Recently, the CNIPA issued the “Notice Regarding the Rejection of 109 Trademark Registration Applications including “YANG Qian,” “CHEN Meng,” and “QUAN Hongchan in accordance with the law,” announcing the rejection of the trademark registration of the Olympic gold medalists’ name by related enterprises and natural persons.

The main content of the announcement is as follows: individual enterprises and natural persons have maliciously registered the names of Olympic athletes such as “YANG Qian,” “CHEN Meng,” and “QUAN Hongchan” and related key words with specific meanings such as “Xing Ge” and “Tian Shen.” Submitting a trademark application with the purpose to seize or improperly use the reputation of others in the market, infringe on the rights of others’ names and their legitimate rights and interests caused negative social impact. In this regard, the CNIPA condemned such behavior and in accordance with the Article 10(i)(8) of the Chinese Trademark Law quickly rejected the 109 trademark applications (including one mark filed in multiple classes) including “YANG Qian,” “CHEN Meng,” and “QUAN Hongchan” marks. The CNIPA will, as always, maintain a high-pressure state in cracking down on malicious trademark squatting, and continuously strengthen the protection of the names of high-profile public figures including Olympic athletes. Applicants who seek improper interests and their entrusted trademark agencies shall be strictly dealt with in accordance with laws and regulations.

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