Weekly China Trademark News Updates

August 17, 2022

1. Tsingtao Beer prevailed against counterfeit beer in an administrative litigation

The Shandong High Court rendered the second instance administrative judgement against the appellant, Pingdu City Yue Yong Yue You Condiments Wholesale (“Yue Yong Yue You”) and in favor of the Qingdao Administration for Market Regulation (“Qingdao AMR”) and the third party in the original trial, Tsingtao Brewery Co., Ltd. (“Tsingtao Brewery”).

On May 18, 2021, the Qingdao AMR conducted a law enforcement inspection on Yue Yong Yue You and found that its operation of “Qingqi brand special beer” constituted unauthorized use of others’ identical or similar logos with packaging and decoration that had certain influences, which amounted to unfair competition and in violation of Article 6 Paragraph 1 of the Anti-Unfair Competition Law that stipulates “business operators shall not carry out the following confusing acts: (1) unauthorized use of others’ identical or similar product names, packaging, decoration, etc. that have certain influences.” An administrative penalty decision was made on August 31, 2021, and Yue Yong Yue You was ordered to correct its illegal acts and imposed a fine of RMB 537,750 (USD79,223).

The first instance court found that the packaging of Qingqi brand special beer used by Yue Yong Yue You was similar to the outer packaging of Tsingtao Beer’s “500ml Classic Canned Tsingtao Beer,” except for the internal patterns, words, and trademarks in the middle of the runway figure, and that the content of the text on the side of the can was slightly different. The overall color matching of the can and the design arrangement of specific details were similar to the design characteristics of Tsingtao Beer products. Combined with the attributes of the product as a fast-moving consumer product, it was easy to cause confusion among the relevant public. Yue Yong Yue You admitted that they sold the infringing products and their acts constituted unfair competition. The Qingdao AMR’s said decision was not incorrect.

The Second Instance Court affirmed the first instance judgment and clarified that the “operator” as the subject of “confusion” stipulated in the Anti-Unfair Competition Law includes both the manufacturers engaged in the manufacture of goods and the sellers or service provider who engaged in the goods business. Meanwhile, it was clarified that when a business operator knows or should know that the products sold are counterfeit products with a unique name, packaging and decoration of a well-known product, the “confusion” acts implemented by such business operator shall be punished according to law.

2. Xiaomi prevailed in a trademark infringement and unfair competition dispute against an individual

On June 23, 2022, the Shanghai Intellectual Property Court rendered a first instance judgement against Zhou Qiujun and Shanghai Xunmeng Information Technology Co., Ltd. (“Xunmeng”) in favor of Xiaomi Technology Co. Ltd. (“Xiaomi Technology”) and Xiaomi Communication Technology Co., Ltd. (“Xiaomi Communication”) in a trademark infringement and unfair competition dispute. Zhou was ordered to compensate the plaintiffs for economic losses and reasonable expenses totaling RMB 500,000 (USD73,661).

After hearing, the court held that the “Xiaomi” mark owned by Xiaomi Technology has continued to be used since its approval for registration. The plaintiff and its affiliates invested a lot of money to promote the Xiaomi brand and won many honors, and the cited trademark can be recognized as a well-known mark because it was known to the relevant public in China as of 2020. When Zhou sold the four alleged infringing products, namely bathroom ceiling heater, heater fan, flat lamp, and cool bar in his store, logos such as “Xiaomi,” “Xiaomi Home Bathroom Ceiling Heater,” “Xiaomi Home Heater Fan,” “Xiaomi Home Flat Lamp,” and “Xiaomi Home Cooling Bar” were prominently used on the product name, product photo, product detail page, product body, outer packaging, and instruction manual. Such use of the “Xiaomi” logo constituted as copying and imitating the plaintiffs’ “Xiaomi” well-known mark on  dissimilar goods, and unfairly misappropriated the “Xiaomi” mark’s market goodwill, misled the relevant public, damaged other’s legitimate interest and constituted trademark infringement.

Defendant Zhou Qiujun showed in his store video that it was a “Xiaomi | Life Appliances Specialty Store,” which would mislead the relevant public into believing that the products sold by the store were from the plaintiffs or had an association with the plaintiff, which had the intention to take advantage of the plaintiffs’ business reputation and reputation of its goods to enhance competition. Such acts violated the good faith principle and constituted unfair competition.

3. China’s first “100,000 Why” trademark protection case finally prevailed in its final trial

In June 2017, Shanghai Century Publishing Co., Ltd. Children’s Publishing House registered the trademark of “100,000 Why 100,000 WHYS and Design,” and the approved goods were books, printed publications, etc. in class 16. On January 27, 2019, the trademark was assigned to Shanghai Children’s Publishing House Co., Ltd. (“Children’s Publishing Company”).

The Children’s Publishing Company found that the cover of the book “100,000 Whys” in the Jiangqiao Wanda Store of the Xinhua Bookstore of Sichuan Tiandi Publishing House Co., Ltd. marked “100,000 Whys” and “Golden Classic for Chinese Children” in a relatively small font, and there are a total of 15 books (sets) on Jingdong Tiandi Publishing House, Tiandi Publishing House official website, Dangdang Tiandi Publishing House, Tmall Tiandi Publishing House flagship store, etc. marked with the description “100,000 Wy is a classic reading for generations… This book is an upgraded version of 100,000 Whys.” At the beginning of 2020, Children’s Publishing Company initiated the first lawsuit against Tiandi Publishing House and Shanghai Xinhua Media Chain Co., Ltd. Xinhua Bookstore Jiangqiao Wanda Store in Shanghai Putuo District Court. The Shanghai Putuo District Court rendered a first-instance judgment ordering the defendant Tiandi Publishing House and others to immediately stop trademark infringement and unfair competition, and compensate the plaintiff for economic losses and reasonable costs of RMB600,000 (USD88,393). The Shanghai Intellectual Property Court then rejected the appeal and upheld the original judgment.

The Shanghai Intellectual Property Court held that “100,000 Whys” itself has an inherent meaning, but it was not equivalent to the generic name of the relevant goods. Question-and-answer popular science books included the “100,000 Whys” series of books involved in this case, but “100,000 Whys” were not yet the same as question-and-answer books. The prominent use of “100,000 Whys” on the cover of relevant books by Tiandi Publishing House was not a fair use to explain the content of the book, but constituted as trademark use to identify the source of the book, and objectively plays the function and role of identifying the source of the book. It was easy to cause confusion and misunderstanding to book buyers about the source of books or the relationship between Tiandi Publishing House and Children’s Publishing House.

Among the 14 books involved in the case by Tiandi Publishing House, 9 of them were first published in June 2017, before the Children’s Publishing House obtained the trademark registration, but at this time, the Children’s Publishing House’s “100,000 Whys” series has obtained a high reputation and goodwill in the field of children’s popular science books after long-term use and publicity. It was widely known by the public, and has the attributes of identifying the source of a series of books. Therefore, it was not inappropriate for the first instance court to determine that it should be protected as the unique name of a fmous good.

Tiandi Publishing House used the expression “100,000 Whys is a classic reading that has influenced generations… This book is an upgraded version of 100,000 Whys” without justifiable reasons, which would easily lead readers into believing that Tiandi Publishing House’s book was an upgrade of Children’s Publishing House’s “100,000 Why” series of books, which constituted false advertising.

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