Weekly China Trademark News Updates

February 1, 2021

1. The CNIPA published 2020 Annual Trademark Statistics

In 2020, 5.76 million marks were registered from applicants worldwide. Although 2020 was hit by the pandemic, domestic applicants managed to file 7,553 trademark applications under the Madrid Protocol before the CNIPA.

With a striking 64.7% year-on-year growth, the CNIPA closed 149,000 trademark oppositions. Among them, 55,079 cases were allowed for registration, 38,988 cases were refused for registration, and 9,176 cases were partially allowed for registration.

358,000 other trademark adjudication cases (including rejection appeals, registration refusal appeals, invalidation actions, non-use cancellation appeals, etc.) were closed, achieving a 7.8% year-on-year growth. Among them, the success rate for refusal appeal was 33.2%, the success rate for invalidation was 70.4%.

The average trademark examination time had been shortened to 4 months.

Since 2019, the CNIPA has been organizing and executing the “Blue Sky” Special Initiative among IP agencies nationwide to further strengthen supervision on questionable agencies and enhancing the continued healthy development. By 2020, 2,950 agencies have been interviewed and 1,095 were ordered of rectification, 23,000 agencies have completed self-inspection and made credit commitment.

2. Kinder Surprise Egg affirmed as goods packaging decorations of certain influences, Ferrero received RMB700,000 (USD108,000) in damages

Soremartec SA, Ferrero SpA., and Ferrero Trading (Shanghai) Co., Ltd.t (“Ferrero”) sued Chaozhou City Chaoya Distrct Yaliwen Food Factory (“Yaliwen”) for trademark infringement and anti-unfair competition claiming RMB 1 million (USD 154,750) in damages.

The second instance court held that Yaliwen’s infringing products were similar to Ferrero’s registered trademarks and used on identical goods, which were likely to cause confusion to the relevant public and infringed upon Ferrero’s trademark rights. Meanwhile, the overall appearance of the infringing products was similar to Kinder Surprise Egg’ packaging and decoration, which was likely to cause confusion to the relevant public on the source of goods and amounted to unfair competition.

Kinder Surprise Egg

Infringing goods samples

In finding trademark infringement, the second instance court reasoned that overall appearances or the various compositions as used on every infringing products were likely to cause confusion and were similar to Ferrero’s registered trademarks. In particular, the egg-shaped products, the words’ compositions, the wave design separating the overall designs, and the milk drop design were all similar to the composition and arrangements of various elements found in Ferrero’s registered trademarks. The second instance court concluded that consider Ferrero trademarks’ distinctiveness and fame, use of the alleged infringing trademarks were likely to confuse or mistake the relevant public as to the sources of goods and constituted as trademark infringement.

Regarding whether the packaging and decoration of the Kinder Surprise Egg has certain influence, the second instance court found that it does. First, Ferrero’s evidence proved that A) the Kinder Surprise Egg have been recognized and protected as a famous product multiple times. B) The Kinder Surprise Egg has been in the market since 2011 and became available nationwide with vast amount of advertising expenses and countless promotions. C) Combining its lengths and number of sales, time and level of promotion, Kinder Surprise Egg should be recognized as famous in the market and known by the relevant public in the mainland China market. Second, the packaging and decoration used on the words, colors, graphical design, and composition were uniquely designed, which embodied distinctive characteristics and allowed consumers to distinguish the source of goods. Accordingly, Kinder Surprise Egg’s packaging and decoration shall be considered as a protected product packaging and decoration that has certain influence under the Chinese Anti-unfair Competition Law.

3. World Trade Centers obtained 3 million (USD 464,300) in damages for others using WTC as real estate names

The World Trade Centers Association (“WTCA”) alleged that the naming of the disputed real estate as “Taizhou World Trade Center in Chinese (台州世贸中心)” by Taizhou World Trade Company (“TWTC”), and TWTC’s promotion of that building as the “World Trade Center in Chinese (世贸中心)” with Dongsen Holdings and Dongsen Real Estate Company (“Dongsen”) infringed its trademark right and amounted to unfair competition. The WTCA petitioned the court for RMB 3 million (USD 464,302) in economic loss and reasonable legal costs.

Taizhou World Trade Center in Chinese (台州世贸中心)

In its findings for trademark infringement, the court found that the WTCA registered the “WTC,” “WORLD TRADE CENTER,” and other related trademarks for services in Class 41. Not only have these trademarks been primarily used for conferences and exhibitions, but they have also been specially licensed to be used to name the relevant real estate the “World Trade Center in Chinese (世贸中心)” for promotional purposes. Meanwhile, relevant public also learned about WTCA’s registered trademarks through these real estates. The purpose for TWTC to name its real estate as “Taizhou World Trade Center in Chinese” and to use marks “WTC,” “World Trade Center in Chinese (世贸中心),” and “WORLD TRADE CENTER” in its promotional materials were to invite businesses or increase sales volume. Such use overlapped with the purpose of the services designed under the WTCA’s registered trademarks. In addition, TWTC’s scope of business and the disputed real estate’s functions also include exhibition services, which overlapped with WTCA’s services. Thus, the approved services of the WTCA’s registered trademarks and the services where TWTC used its marks constituted as similar. Moreover, TWTC knew of the fame of the WTCA’s registered trademarks but still used identical or similar marks, which demonstrated obviously bad faith in free riding the WTCA’s fame. Accordingly, TWTC’s infringed upon WTCA’s exclusive trademark rights when TWTC used marks identical or similar to WTCA’s registered trademarks on the disputed real estate and on promotional materials without authorization, and when TWTC registered and used the domain name “www.tzwtc.com.”

4. Tongji Vientiane City was ordered to pay China Resources Vientiane City RMB 1 million (USD 154,750) in damages

“Wan Xiang Cheng in Chinese (万象城)” and “themixc + Wan Xiang Cheng in Chinese (萬象城)” were famous real estate brands owned by the China Resources Group (“CRG”). Upon finding a real estate named “Tong Ji Wan Xiang Cheng in Chinese (同济万象城),” CRG sued the real estate owner for trademark infringement and petitioned for RMB 5 million (USD 773,800) for damages and reasonable legal costs.

Tong Ji Wan Xiang Cheng in Chinese (同济万象城)

Wan Xiang Cheng in Chinese (萬象城)

The court found that “Tong Ji Wan Xiang Cheng in Chinese (同济万象城)” was similar to the “Wan Xiang Cheng in Chinese (万象城)” series trademarks owned by CRG, and Tongji Real Estate Company (“Tongji Real Estate”), owner of the dispute real estate, infringed upon CRG’s exclusive trademark rights. Although Tongji Real Estate claimed that it had used “Wan Xiang Cheng in Chinese (万象城)” in 2009 and 2011 for other construction projections that were earlier than the filing date of CRG’s “Wan Xiang Cheng in Chinese (万象城)” and “themixc+ Wan Xiang Cheng in Chinese (萬象城)” trademarks, and constituted as prior use. The court reasoned that CRG began using the “Wan Xiang Cheng in Chinese (万象城)” trademark in 2004 for its real estate project in Shenzhen. Therefore, Tongji Real Estate’s claim cannot be supported.

The first instance court ordered Tongji Real Estate to immediately stop all infringing activities and pay economic loss of RMB 1 million (USD 154,750). The second instance court affirmed.

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