Weekly China Brand Protection News

August 29, 2024

1. A bad faith registration of the well-known “BENTLEY” mark invalidated despite being registered for over five years

The Beijing IP Court recently concluded an administrative dispute case regarding the invalidation of the “BENTLEY” mark with reg. no. 7631725 (“Disputed Mark”), involving the plaintiff Aucera.SA, the defendant CNIPA, and the third party Bentley Motors Limited. The court ruled to reject the plaintiff’s litigation request.

The key issue in this case was whether the application and registration of the Disputed Mark violated Article 13, Paragraph 2 of the 2001 Trademark Law. The Beijing IP Court held that the evidence submitted by the third party can prove that, prior to the Disputed Marks’ application date, the cited trademark had been widely recognized by the relevant public in the “automobile” category due to long-term promotion and use, reaching the status of a well-known trademark. Moreover, according to the evidence, besides the Disputed Mark in this case, the plaintiff had also applied for several trademarks such as “BENTLEY,” “B and Logo,” and “Bentley in Chinese” across multiple classes, including classes 9, 10, and 14, indicating that the plaintiff’s purpose in registering the Disputed Mark was questionable. Therefore, the third party’s request to invalidate the Disputed Mark, registered on November 21, 2010, should not be restricted by the five-year limit.

The Disputed Mark is identical in text, pronunciation, and meaning to the cited trademark “BENTLEY” with reg. no. 862360, constituting a copy and imitation of the cited trademark. Although the goods designated for use under the Disputed Mark in Class 18, such as “wallets; card cases (wallets),” do not fall under the same class as the “automobiles” under Class 12, for which the cited trademark is well-known, considering the well-known status of the third party’s cited trademark, the use of the Disputed Mark on “wallets; card cases (wallets)” is likely to cause the relevant public to associate it with the third party’s cited trademark. This could unjustly leverage the goodwill established by the third party through long-term business operations, potentially harming the third party’s interests. Therefore, the application and registration of the Disputed Mark violated Article 13, Paragraph 2 of the 2001 Trademark Law and should be declared invalid.

2. Repeated registration of Youku animation program and character names harms Youku’s legal rights and constitutes unfair competition; trademark agency’s acceptance of illegal commissions constitutes contributory infringement

Youku Information Technology (Beijing) Co., Ltd. (“Youku”) introduced the animated IP “Tina & Tony” produced and distributed by Riki Co. Ltd. of Russia to China and began broadcasting it on the Youku children’s channel on November 23, 2018, while also promoting and marketing the series. Starting from December 13, 2018, Ding (an individual), through the Shandong Weicheng Intellectual Property Service Co., Ltd. (“Weicheng”), applied in three batches to register 69 trademarks that were identical or similar to the program and character names of the “Tina & Tony” animation series. After Youku filed oppositions and invalidation requests against some of these trademarks, Ding still did not cease the registration attempts. Youku filed a lawsuit in the Linyi Intermediate Court in Shandong, claiming that Ding’s actions and Weicheng constituted unfair competition and sought joint compensation from the defendants for economic losses and reasonable expenses totaling CNY 2 million (USD280,700).

After a first-instance trial, the Linyi Intermediate Court found that:

1. Ding’s actions constituted unfair competition. Youku is the producer of the “Tina & Tony” animation series and its derivatives, as well as the copyright holder of the series’ name logo and character images, which are considered artistic works. Youku enjoys related rights protected under the Anti-Unfair Competition Law based on the animation series and the “Tina & Tony” English and Chinese names, character names, and images, making Youku the appropriate plaintiff in this case. Youku has the right to commercialize the elements of the involved animation IP. The Chinese version of “Tina & Tony” has been broadcast on Youku’s children’s channel since November 23, 2018, and has gained significant market recognition through Youku’s promotion and marketing efforts. The program’s name, character images, and names have achieved a certain level of recognition and notoriety among the relevant public, qualifying them as identifying marks under Article 6, Paragraph 1 and 4 of the Anti-Unfair Competition Law. Since December 13, 2018, Ding applied in three batches to register 69 trademarks that were identical to the program and character names of the aforementioned animation series, especially after some of the trademarks in the first batch were rejected or invalidated by the CNIPA. Despite this, Ding continued to register trademarks identical to the program and character names of the animation series, which clearly demonstrates an intention to copy and imitate another’s well-known marks to gain unfair benefits, violating the principle of good faith and causing significant damage to Youku, while also disrupting fair market competition. Therefore, Ding’s actions constitute unfair competition.

2. Weicheng’s actions constituted contributory Weicheng, as a professional trademark agency, was involved in the entire process of Ding’s trademark applications, objections, and invalidations. Despite knowing that Ding’s commissioned trademarks violated relevant provisions of the Trademark Law, Weicheng continued to accept the commission, constituting aiding infringement and making Weicheng jointly liable with Ding.

In conclusion, the first-instance court ruled that Ding must immediately withdraw or cancel all pending or registered trademarks identical or similar to Youku’s animation program names, character names, and character images. Furthermore, Ding was ordered to stop bad faith trademark registrations. The court also ordered Ding to pay Youku CNY 200,000 in compensation for economic losses and reasonable expenses, with Weicheng jointly responsible for CNY 100,000 of the compensation.

Both Youku and Weicheng appealed to the Shandong High Court. The key points of dispute in the second instance were:

1. Whether Youku is a proper party to the lawsuit. The Shandong High Court found that Youku introduced the involved series of animations to China and broadcasted them on the Youku children’s channel. As the producer or filing unit of the series and its derivatives, Youku had engaged in promotion and marketing. These facts confirm that Youku is the rights holder of the identifying marks under protection by the Anti-Unfair Competition Law related to the “Tina & Tony” series, including character names and images. Therefore, Youku is entitled to file a lawsuit and is a proper party in this case.

2. Whether Weicheng’s actions constituted contributory Ding commissioned Weicheng to handle the applications for all 69 involved trademarks. After CNIPA decided to reject eight of the trademarks in the first batch due to infringement of prior copyrights, Weicheng, knowing that the commissioned trademark applications violated the Trademark Law, still accepted the commission to handle further trademark applications. The first-instance court’s determination that Weicheng’s actions constituted aiding infringement and held them responsible was appropriate.

3. Whether the compensation amount determined by the first-instance court was appropriate. In this case, neither party provided evidence to prove the actual damages Youku suffered from the infringement or the benefits Ding and Weicheng gained from the infringement. Given that Youku claimed statutory damages, the first-instance court considered factors such as the notoriety and commercial value of the identifying marks, the infringement circumstances and intent of Ding and Weicheng, and Youku’s costs of rights protection. The court’s decision to award CNY 200,000 in damages, with Weicheng jointly liable for CNY 100,000, was appropriate. Additionally, Youku’s claim that the first-instance court unfairly allocated most of the litigation costs to Youku was unfounded. The court awarded CNY 200,000 in compensation out of the CNY 2 million claimed, the cost allocation is reasonable and should be upheld.

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