Weekly China Brand Protection News

December 13, 2024

1. Huawei prevailed in a trademark infringement lawsuit with CNY 5 million in damages

Recently, the Guangdong High Court issued a final judgment in a trademark infringement and unfair competition lawsuit involving Huawei Technologies Co., Ltd. (“Huawei”) and the defendants Zhongshan Songling Appliance Gas Co., Ltd. (“Songling”) and Chengdu Hongnian Trading Co., Ltd. (“Hongnian”). The court found that Huawei’s “Huawei in Chinese” trademark (“Subject Mark”) constitutes well-known trademark for goods such as “mobile phones and smartphones.” The defendants were found to have committed trademark infringement and unfair competition, and the court ordered them to compensate Huawei for economic losses amounting to RMB 5 million (USD 688,000).

The court found the following facts:

First, the evidence provided by Huawei demonstrated that its “Huawei in Chinese” trademark, registered in October 2017, has been continuously used since its registration. Huawei and its affiliated companies invested substantial resources to promote the Huawei brand, which has received numerous accolades. Huawei’s “Huawei in Chinese” trademark was previously recognized as a well-known trademark by the Trademark Office. The continuous and extensive use of the Subject Mark coupled with Huawei’s high market share and reputation in the smartphone industry, confirms that, as of August 8, 2019, the trademark was widely recognized by the relevant public in China for Class 9 goods such as “mobile phones and smartphones,” achieving well-known status.

Second, Songling used marks such as “vavi Huawei in Chinese,” “Huawei Technology in Chinese,” “Huawei Kitchen and Bathroom in Chinese,” and “Huawei Kitchen Appliances in Chinese” on its official website, WeChat public account, business premises, product brochures, and on the packaging of products such as range hoods, water heaters, and gas stoves. These marks served to identify the source of goods, constituting trademark use. Among these, “Huawei in Chinese” is the most distinctive element. Upon comparison, these marks were found identical to Huawei’s well-known Subject Mark. Songling’s replication of the Subject Mark for dissimilar goods as a trademark misled the public into associating the infringing marks with Huawei’s well-known trademark, diluting its distinctiveness, or unfairly exploiting Huawei’s market reputation.

Third, Hongnian, a distributor for Songling’s “vavi Huawei in Chinese” branded products, sold goods infringing on the Subject Mark and used infringing marks such as “vavi Huawei Kitchen Appliances” and “vavi Huawei Smart Kitchen Appliances” on store signage and receipts. As a result, Hongnian’s acts constituted an infringement of Huawei’s trademark rights.

Last, Huawei alleged that Songling engaged in false advertising by promoting its “vavi Huawei ion Chinese” brand on its website and in product brochures with claims such as being one of “China’s Top 10 Kitchen Appliance Brands,” a “World Fortune 500 Kitchen and Bathroom Brand,” a “National Consumer Trustworthy Brand,” and a “Recommended Product for China’s Engineering Construction.” Songling failed to provide valid evidence to substantiate these claims, making false statements about product quality, sales performance, and honors received. These acts misled and deceived consumers, constituting false advertising and unfair competition.

2. The Beijing High Court applied strict scrutiny against parties that were found to have submitted deceptive evidence in the past

Recently, the Beijing High Court issued an administrative dispute concerning the review of the cancellation of the “Guiyu in Chinese GUIYU & Design” mark (“Disputed Mark”). The court ruled that the registration of the Disputed Mark owned by Guizhou Renhuai Pengyan Liquor Sales Co., Ltd. (Pengyan) should be revoked.

In this case, the two invoices submitted by Pengyan were verified on the National VAT Invoice Inspection Platform of the State Taxation Administration and both returned negative results. Additionally, Pengyan failed to provide the original invoices. The original invoice numbered 05101287 had an issue date of October 22, 2020, which differed from the date of January 22, 2020, shown in the copy submitted during the administrative stage. Given that Pengyan submitted deceptive evidence in this case, other evidence it provided was subject to stricter scrutiny. The Trademark License Usage Agreement submitted by Pengyan could not independently prove the use of the Disputed Mark and required corroboration with other evidence. Product photos were deemed self-created evidence. Contracts for specialized design services, design fee invoices, bank transfer receipts, related explanations, purchase orders and invoices signed by Pengyan and Lü Yajun were all dated outside the designated period.

Considering the evidence as a whole, there was no complete evidence chain to prove that the Disputed Mark had been genuinely, legally, and effectively used for commercial purposes on all the approved goods, such as “alcoholic beverages (except beer),” during the designated period. Consequently, the court ruled that the registration of the Disputed Mark should be revoked.

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