Weekly China Trademark News Updates

August 9, 2022

1. Dual-track system compensation of RMB 1.86 million against a trademark infringer for infringing the “JUKI” mark

The Shanghai Intellectual Property Court recently made a final judgment on the trademark infringement dispute between Juki Corporation. (“Juki”) and Zhejiang Jukai Sewing Technology Co., Ltd. (“Jukai”), finding that Jukai’s acts constituted trademark infringement and shall compensate Juki for economic losses of RMB 1.86 million (USD275,270).

Cited Marks

Juki registered the “JUKI” marks (“Cited Marks”) on May 30, 1981, September 12, 2003, and December 29, 2005, respectively. The Cited Marks were approved in Class 7 for “machines for sewing, pedal drives for sewing machines, sewing machines” and other goods. Jukai marked the “JUKAI” logo on the allegedly infringing sewing machines and product packaging for sell in the “Huiyou Sewing Equipment Store” in Wuhu City, Anhui Province. Jukai highlighted the use of “JUKAI” and “JUKAI and Shield Logo” on sewing machines, brochures and business cards in an exhibition in Shanghai. Jukai prominently marks the “Jukai in Chinese and JUKAI” logo on the industrial sewing machines and cargo packing boxes declared by at the Beilun Customs for export to Morocco and at the Ningbo Customs for export to India.” Jukai also extensively used the “JUKAI” logo on www.cn-jukai.com and its webpages. Jukai prominently positions “JUKAI” in the company introduction and promotional videos on its WeChat official account and uses “JUKAI” as its avatar.

The first instance court held that Jukai infringed Juki’s trademark. Jukai was unsatisfied with the judgement and appealed to the Shanghai IP Court. The Shanghai IP Court affirmed that Jukai infringed Juki’s trademark. The Shanghai IP Court found that the “JUKAI” logo was similar to Juki’s three registered trademarks. Juki’s Cited Marks enjoy high reputation, and Jukai, as a competitor in the same industry, should’ve knew about it, but it still used the “JUKAI” and “Jukai in Chinese and JUKAI” logos. Jukai also uses the same model number, product layouts, logo location, and labeling method that were highly similar to Juki’s products, which showed its subjective intention of infringement. Regarding the “dual-track system of compensation,” first, taking into account the subjective intention of Jukai, the scale and circumstances of infringement, and the specific sales situation that can be identified, punitive damages shall be applied to the part of export orders for which the specific sales situation can be identified. Second, consider Jukai’s domestic manufacturing and sales, combined with factors such as intentional infringement and seriousness of its infringement, statutory compensation shall be applied for sales activities that cannot be identified.

2. Dorco Co., Ltd. obtained RMB 8 million in compensation as stipulated in its agreement with the defendants

The Zhejiang High Court recently rendered a trademark infringement judgement and ordered RMB 8 million (USD 1.18 million) in economic losses and reasonable expenses for Dorco Co., Ltd. (“Dorco”) and against Jiangxi Xirui Blade Manufacturing Co., Ltd. (“Jiangxi Xirui”), Shanghai Xirui Blade Co., Ltd. (“Shanghai Xirui”), Zhangjiagang City Jinfeng Town Hexing Sandeli Hardware Tools Factory (“Hexing Sandeli”), Shaoxing Beisujie Commodity Co., Ltd. (“Beisujie”) and Shaoxing Jijie E-Commerce Co., Ltd. (“Jijie”).

Cited Marks

Dorco registered the “DORCO” marks (“Cited Marks”) on September 20, 1991 and May 14, 2010, respectively. The Cited Marks were approved in Class 8 for “razors, razor blades, and knives with handles” and have obtained a certain reputation in the domestic market. Shanghai Xirui registered the “DOREO” mark on March 21, 2015. The “DOREO” mark was approved in Class 8 for “planing blades, sharp tools (hand tools)” and other goods. On October 15, 2019, Dorco signed a settlement agreement on Jiangxi Xirui’s mass production of counterfeit goods that infringed Dorco’s registered trademarks. The agreement stipulated that if Jiangxi Xirui and its related parties would repetitively infringe Derco’s trademark right, the compensation shall be ten times the value of the genuine goods unconditionally. After investigation by Dorco, Dorco found that Jiangxi Xirui disregarded the said stipulations in the settlement agreement and continued to carry out its infringing acts intermittently. Moreover, the said counterfeit goods were sold by Hexing Sandeli, Beisujie, and Jijie through Alibaba or AliExpress. Jiangxi Xirui did not object to its act of manufacturing and selling the accused infringing goods, and admitted that the accused infringing products sold by Hexing Sandeli and Beisujie were purchased from them. During the period from August 3, 2020 to April 12, 2021, under the supervision of a notary public, Dorco inspected and sealed the packages of the allegedly infringing products for 15 shops of Hexing Sandeli Factory and Beisujie on the Alibaba, Aliexpres, Taobao, and Pinduoduo.

The court found that the existing evidence provided by Dorco was not enough to prove that the products it manufactured and sold had a certain influence, so the defendant’s acts did not amount to unfair competition. The accused infringing razor blade was the same product as the razor blade goods approved for use by Dorco’s said Cited Marks. Moreover, the conspicuous positions on the inner and outer packaging of the accused infringing goods bear the “DORCO” logo and words. The court comprehensively determined that Jiangxi Xirui and Shanghai Xirui used the accused infringing logo and sold the accused infringing goods, which constituted trademark infringement. In addition, both Hexing Sandeli and Beisujie recognized that they had sold the alleged infringing goods, and their infringements also constituted trademark infringements.

3. The Beijing High Court: Massive squatting of well-known trademarks constitutes other illegal means of registration

The Beijing High Court recently made a judgment that rejected the appeal petition filed by Dongfang Mingri (Jinjiang) Import and Export Co., Ltd. (“Dongfang Mingri”) and upheld the first-instance judgment. The Disputed Mark “Bin Li Kai Le Zhuang Yuan in Chinese” was declared as invalid according to Paragraph 1 Article 44 of the Trademark Law.

Disputed Mark

The first-instance judgment of the Beijing Intellectual Property Court found that: Dongfang Mingri and its affiliated companies have registered more than 200 trademarks in various classes, including “B and Design, “BENTLEY,” “Bentley in Chinese,” and “Penfolds in Chinese” and other trademarks that were identical or similar to other name brands. They have also registered trademarks of famous wine brands or sports celebrities in many classes. Said filings have obvious subjective intentions of copying and plagiarizing others’ well-known trademarks, improperly occupying public resources, violating the principles of public order and good customs, and detrimental to the market environment of fair competition. After the second-instance trial, the second instance court further found that based on the first-instance judgment, Dongfang Mingri did not provide a reasonable explanation for the design sources of the more than 200 trademarks it applied for registration under its name. Although it submitted agency contracts and sales invoices, the number of these contracts and invoices were limited, and were not only for the Disputed Mark. It was difficult to determine that Dongfang Mingri has actual intention to use the Disputed Mark and continued to use it. The application of Dongfang Mingri has obviously exceeded the normal production and operation needs, disrupted the order of trademark registration management, improperly occupied public resources, and harmed public interests.

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