Weekly China Brand Protection News

March 29, 2024

1. Filing an infringement lawsuit against others’ legitimate use of a trademark based on a trademark obtained through bad faith is an abuse of trademark rights, and its infringement claim should not be supported

The Suzhou Intermediate Court recently concluded a trademark infringement lawsuit between the appellant Hangzhou Lunfude Chassis Technology Co., Ltd. (“Lunfude”), the appellee Suzhou Deyu Auto Parts Co., Ltd. (“Deyu”), and the third party ZF Sales Service (China) Co., Ltd. (“ZF Sales”). The court found that in view of factors such as ZF Sales and its affiliates’ prior right status, the legitimacy of use and intent to use, and Lunfude’s registration was based on bad faith, Lunfude’s infringement claims shall not be supported.

The second instance court found that before Lunfude applied for the cited mark, ZF Sales and its affiliates had used the “” and “” marks extensively on their control arms and other auto parts products and had marked “LEMFORDER” in a reasonable manner and with other trademarks. ZF Sales’s use constituted as prior good faith use. ZF has a high reputation in the auto parts industry and its products are widely used in vehicles, ships, and construction machinery vehicles. Although it has not registered the said marks in China, after years of market operation and comprehensive consideration of other factors such as the continuous time of use, region, sales volume and publicity of the said marks, the first instance court determined that the said marks enjoyed a certain influence. Before Lunfude applied to register the cited mark, ZF Sales already had a high reputation in the industry. According to the evidence, ZF Sales has entered the Chinese market in 1988 and many news had reported that ZF Sales and its affiliates has occupied in the leading position in the automotive parts and chassis technology industries. Its goodwill covers a wide range of industries. The “” and “” marks in this case are all used for vehicle parts products, so ZF Sale’s use does not exceed the original scope of use. In summary, the first instance court found that ZF Sales had a legitimate basis for prior rights and was not inappropriate.

The authorization letter and purchase and sale list and other evidence submitted by Deyu were sufficient to prove that the allegedly infringing products it sold originate from ZF Sales, and ZF Sales has also confirmed it. Therefore, as a seller, Deyu has the right to use “” and “” marks on the products sold by ZF Sales on the premise that ZF Sales has legal prior rights in the accused infringing products. Thus, Deyu did not infringe Lunfude’s trademarks.

Lunfude’s corporate name has a similar pronunciation to the “LEMFORDER” brand name of ZF Sales. It has applied for registration of more than a hundred trademarks that are highly similar to the trademarks of ZF Sales and its affiliated companies in multiple classes, which are beyond the needs of normal business operations. ZF Sales has repeatedly opposed Lunfude’s applications, and the CNIPA has repeatedly declared its registered trademark invalid because it “violates the principle of good faith and disrupts the order of trademark registration management.” In this case, the CNIPA has declared Lunfude’s trademark invalid on the grounds that it has “the subjective intention to take advantage of others’ market reputation and violates the principle of good faith.” Lunfude’s trademarks are similar to ZF Sale’s prior marks. Therefore, Lunfude has a subjective intention to take advantage of ZF Sale’s market reputation. Lunfude’s action violated the principle of good faith, and the first instance court was not inappropriate in not supporting its claim on the grounds that it constituted an abuse of rights.

2. The Guangdong High Court: Criteria for judging whether use of a registered trademark before cancellation constitutes infringement

The Guangdong High Court recently concluded a trademark infringement and unfair competition lawsuit between the appellants Guangdong Weipeng Electric Co., Ltd. (“Guangdong Weipen”), an individual Ji, an individual Li, and others for their disputes with the appellee Robert Bosch Co., Ltd. (“Bosch”) and Bosch (China) Investment Co., Ltd. (“Bosch China”). The court held that the defendants should immediately stop trademark infringement and cancel the domain name www.bocseh.cn, and compensate Bosch and Bosch China for RMB 1 million (USD138,000).

In this case, the accused infringing mark “BOCSEH” (“Disputed Mark”) when compared with Bosch’s “BOSCH” mark with reg. no G675705 (“Cited Mark”), the letter composition, pronunciation, and overall appearance are very similar, except for the addition of an English letter “E.” Guangdong Weipeng used the Disputed Mark on identical or similar goods as the goods approved for use of the Cited Mark may easily cause the relevant public to mistakenly believe that the two marks are from the same market entity’s series of trademarks or are somehow related, causing confusion and misidentification of the source of the goods, and constituting trademark infringement of Bosch and Bosch China. Guangdong Weipeng used the slogan “Bosch Technology Realizes Dreams in Chinese” on the certificates of products and on the special dealer plates issued. The “Bosch in Chinese” logo is identical with the “Bosch in Chinese” registration of Bosch and Bosch China. The marks are identical and the class of goods used are identical or similar, which can easily lead to confusion and misunderstanding. Therefore, Guangdong Weipeng’s use constitutes trademark infringement of the “Bosch” mark with reg. no. 546309.

Guangdong Weipeng uses a domain name whose main part is “bocseh” and uses it to promote products and conduct transactions. The main part of this domain name constituted similar to Bosch’s Cited Mark and infringed upon Bosch and Bosch China’s trademark rights.

Guangdong Weipeng appealed and claimed that its Disputed Mark was used after approval, so the accused behavior did not constitute an infringement of the trademark rights of Bosch and Bosch China. In this regard, this court believes that the evidence in this case shows that when Guangdong Bosch Company, the predecessor of Guangdong Weiping, obtained the “BOCSEH” mark with reg. no. 12140329 in 2016, Bosch and Bosch China Company’s registered trademarks “BOCSH” and “Bosch in Chinese” already has a high reputation in China. As a business entity in the household appliance industry, Guangdong Weipeng should be aware of the existence of Bosch and Bosch China’s said marks, but it still applied for the accused logo and uses it in its operations. Therefore, it can be inferred that when Guangdong Weipeng obtained the Disputed Mark, it had obvious subjective malice to take advantage of the goodwill of Bosch and Bosch China. Therefore, even if the Disputed Mark was approved and registered, Guangdong Weipeng’s use still constitutes trademark infringement of the Cited Mark.

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