Weekly China Brand Protection News

January 9, 2025

1. “Trademark Agency” should be judged based on the applicant’s business status at the time of the trademark application

Le Tengda (Shenzhen) Daily Necessities Co., Ltd. (“Le Tengda”) is the registrant of the “OHROPAX” trademark (Reg. No. 22741287) (“Disputed Mark”). OHROPAX GMBH (“Ohropax”) filed an invalidation petition against this trademark. The CNIPA invalidated the Disputed Mark stating that it violated Article 19, Paragraph 4 of the Trademark Law. The first-instance court upheld the decision. Upon review, the second-instance court ruled that according to Article 19, Paragraph 4 of the Trademark Law, a trademark agency, except for applying to register trademarks for its own agency services, cannot apply to register other trademarks. The “trademark agency” mentioned should, in principle, be determined based on the business status of the applicant at the time of filing the trademark application. However, if the applicant engages in trademark agency services after the trademark is approved for registration, or even during subsequent examination procedures, a comprehensive determination should be made based on the specific circumstances in the case.

Based on the evidence in the case, entities that are registered to engage in trademark agency business, those whose business scope recorded in their business license includes trademark agency services, and those who, although not registered, actually engage in trademark agency business, are all considered “trademark agencies.” In this case, the application date for the Disputed Mark was January 25, 2017, and the approval date for registration was April 21, 2018. Le Tengda’s previous business scope that included “trademark agency consultation” services began on August 28, 2018. This shows that at the time of application and approval for registration, Le Tengda’s business scope did not include “trademark agency consultation” services. Ohropax filed for invalidation on October 26, 2022, while Le Tengda had already deleted “trademark agency consultation” services from its business scope on November 21, 2018. Therefore, at the time Ohropax filed for invalidation, Le Tengda’s business scope did not include “trademark agency consultation.” Moreover, there is no evidence to suggest that Le Tengda engaged in trademark agency business or registered or acquired a non-agency trademark through changing its business scope, with the intention of maliciously registering others’ trademarks and profiting from reselling them, which would severely disrupt the trademark market order.

Additionally, the evidence submitted by Le Tengda proves that it has used the Disputed Mark. Therefore, the evidence in the case does not sufficiently demonstrate that Le Tengda is a “trademark agency,” and as such, the registration of the Disputed Mark does not violate the provisions of Article 19, Paragraph 4 of the Trademark Law. Based on this, the second-instance court ruled that the first-instance judgment and the contested decision should be overturned, and remanded the case back to the CNIPA.

2. Is Bulk Trademark Registration Illegal Under Article 2 of the Anti-Unfair Competition Law?

Jinpai Kitchen Cabinet Home Technology Co., Ltd. (“Jinpai Kitchen Cabinet”) sued Jinpai Holdings Co., Ltd. (“Jinpai Holdings”), Pinsheng Home (Jiaxing) Co., Ltd. (“Pinsheng Home”), Shen (an individual), Haiyan Pinsheng Electric Co., Ltd. (“Pinsheng Electric”), and Gao (an individual), claiming that they infringed upon its registered trademark rights and engaged in unfair competition.

The court found the following:

Whether the four prior marks claimed by Jinpai Kitchen Cabinet Company should be recognized as well-known trademarks

Jinpai Kitchen Cabinet requested recognition of its trademarks, including “Jinpai Kitchen Cabinet in Chinese & GOLDENHOME” (Reg. No. 4657214), “Jinpai Kitchen Cabinet in Chinese” (Reg. No. 8608821), “Jingpai in Chinese” (Rg. No. 10293263) (“Jinpai”), and “” (Reg. No. 6191334) as well-known trademarks in relation to goods in Class 20, such as kitchen cabinets. The infringing goods were products like bathroom heaters (bath fans), lighting fixtures, ceiling panels, and clothes drying racks. These items, compared to the kitchen cabinets specified in the prior marks, are related to the home decoration and building materials industry and share some overlap in consumer groups. They are also similar in production, sales channels, function, and use. The relevant public could easily assume a specific connection between the two types of goods. Therefore, the court found the disputed goods to be similar to those covered by the prior marks. Since recognizing the similarity of the goods would allow Jinpai Kitchen Cabinet to seek relief for its trademark rights, the court did not find it necessary to recognize the four prior marks as well-known trademarks.

Whether the infringing actions violated Jinpai Kitchen Cabinet’s trademark rights

The mark with reg. no. 16214651 registered by Jinpai Holdings has been declared invalid, meaning it never had valid trademark rights. The infringing goods were found to be similar to those covered by the prior marks. Also, the infringing marks were sufficiently similar to the prior marks in the eyes of the relevant public. Based on the evidence, Jinpai Kitchen Cabinet has used and promoted its trademarks for many years. Its “Jinpai Kitchen Cabinet in Chinese & GOLDENHOME” brand has received multiple recognitions, such as “Fujian Province Famous Trademark” and “Xiamen City Famous Trademark.” The prior marks are well-known and have strong distinctiveness. The use of the infringing marks could mislead the public into believing that the infringing products come from Jinpai Kitchen Cabinet or are related to it. Therefore, the court found that Jinpai Holdings, Pinsheng Home, and Pinsheng Electric’s actions infringed upon Jinpai Kitchen Cabinet’s trademark rights.

Whether the infringing actions constituted unfair competition

First, in this case, Jinpai Holdings, Pinsheng Home, and Pinsheng Electric used the phrase “CCTV Strong Promotion” on the allegedly infringing products, which should be supported by factual evidence of their promotional activities. Although Jinpai Holdings submitted advertising schedules, video ads, and other evidence in the first instance, claiming that its own brand had been advertised on CCTV, the evidence lacked supporting materials such as advertising contracts and payment receipts. The use of the phrase “CCTV Strong Promotion” by Jinpai Holdings, Pinsheng Home, and Pinsheng Electric clearly misled consumers’ purchasing decisions, while also unfairly enhancing their market competitiveness. This has damaged the competitive interests of other businesses. Therefore, the court ruled that their use of the “CCTV Strong Promotion” slogan constituted false advertising and unfair competition.

Second, regarding whether Jinpai Holdings’ use of the “Jinpai in Chinese” name constituted unfair competition: The cited trademark “Jingpai in Chinese” (Reg. No. 10293263), “Jinpai Kitchen Cabinet in Chinese & GOLDENHOME” (Reg. No. 4657214), and “Jinpai Kitchen Cabinet in Chinese” (Reg. No. 8608821) all include the word “Jingpai in Chinese.” The use of “Jinpai” on products like kitchen cabinets has inherent distinctiveness, and Jinpai Kitchen Cabinet has widely used and promoted the disputed trademarks over many years. These trademarks have gained influence in the relevant fields and are well-known among the public. Jinpai Holdings, being a competitor in the same industry, should have been aware of the market recognition of Jinpai Kitchen Cabinet’s trademarks when it was established in 2014. However, it still registered the same “Jinpai in Chinese” wordmark as part of its company name to identify its core brand in the marketplace and used it in its commercial activities. This act has the subjective intent to benefit from Jinpai Kitchen Cabinet’s reputation, and objectively it is likely to cause confusion among consumers, harming Jinpai Kitchen Cabinet’s interests and disrupting market competition. Therefore, the court ruled that Jinpai Holdings’ use of “Jinpai in Chinese” in its company name constituted unfair competition by using another’s registered trademark.

Finally, regarding the application by Jinpai Holdings to register over 60 “Jinpai in Chinese” series trademarks and Pinsheng Electric’s application to register 3 additional  trademarks: These actions are related to filing trademark registration applications with administrative authorities, not production or business activities regulated by the Anti-Unfair Competition Law. Jinpai Kitchen Cabinet argued that these actions amounted to malicious trademark registrations constituting unfair competition. However, the validity of trademarks must be individually reviewed and assessed by the CNIPA. Despite undergoing trademark oppositions, invalidation requests, review procedures, and administrative lawsuits, over 20 of these trademarks remain valid. If bulk trademark registration activities were indiscriminately classified as unfair competition in trademark infringement litigation, it could conflict with the outcomes of the trademark right confirmation process. Considering the nature of trademark registration and the coordination between the Anti-Unfair Competition Law and the Trademark Law, especially in relation to trademark authorization and confirmation procedures, the court ruled that Article 2 of the Anti-Unfair Competition Law should not be applied to regulate the trademark registration actions in this case.

Compensation amount: The court considered several factors, including the long-standing and wide promotion of Jinpai Kitchen Cabinet’s trademarks, the clear subjective fault of Jinpai Holdings and the other defendants, the ongoing infringement, the wide sales reach of the infringing goods, and the reasonable expenses incurred by Jinpai Kitchen Cabinet for notarization and legal representation. Given these factors, the court found that the first-instance judgment of CNY 400,000 (US$ 56,000) in compensation was too low. The court ordered Jinpai Holdings, Pinsheng Home, and Pinsheng Electric to compensate Jinpai Kitchen Cabinet Company for its economic losses and reasonable expenses totaling CNY 2 million (US$280,000).

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