Weekly China Trademark News Updates

January 17, 2024

1. The “Freshfragrance” mark  was invalidated by the “fresh” mark

In an administrative trademark invalidation dispute between the plaintiff Fresh Company and the defendant CNIPA and the third party Qiong Luo, the Beijing Intellectual Property Court held that the Disputed Mark violated Article 30, Article 31 and Article 32 of the 2013 Trademark Law. The CNIPA’s decision shall be revoked and the CNIPA shall make a new ruling.

Disputed Mark

No.13450891 Subclass 4402

Cited Mark 1	Cited Mark 2	Cited Mark 3	Cited Mark 4	Cited Mark 5
No. 13450891 Subclass 0306	No. 10838741 Subclasses 0301, 0305-0306	No. 8690350 Subclasses 0301, 0305-0306	No. 25228002 Subclass 4405	No. 22753556A Subclasses 4401, 4403, 4405

The first issue is whether the Disputed Mark filed by the third party violates Articles 30 and 31 of the 2013 Trademark Law. The court found that the Disputed Mark consists of the English letters “Freshfragrance”. according to the general English cognition level of Chinese consumers, it is easy to read it as two parts: “Fresh” and “fragrance” of which the “Fresh” part is the same as the Cited Marks 1 and 4 in letter composition. It is also identical with the distinctive part of Cited Marks 2 and 3. It is similar in pronunciation to the Cited Mark 5. The Disputed Mark constitute as an identical mark with all five Cited Marks.  Although all approved services such as “beauty services, massages, and manicures” for use under the Disputed Mark and the approved goods and services for use under the Cited Marks 1 to 5 are in different classes, when considering the following factors, they constitute similar marks. First, the “beauty services, makeup artist services, waxing and hair removal” and other services approved for use by the Disputed Mark are identical to the Cited Marks 1 to 5. The consumer groups of the goods and services approved for use such as “cosmetics and sanitary equipment rental” basically overlap, and are often used in combination, so they are highly related. Second, the Disputed Mark completely contains the distinctive parts of the Cited Marks 1 to 4. They are highly similar. Third, the plaintiff’s “fresh/fuleishi in Chinese” series of trademarks have gained a certain reputation on “cosmetics” products through continuous publicity and use. The coexistence of the Disputed Mark and the Cited Marks may easily cause confusion and misunderstanding the relevant public. In summary, the Disputed Mark and the Cited Marks 1 to 5 constitute similar marks on similar goods and services which violated Articles 30 and 31 of the 2013 Trademark Law.

The second issue is whether the Disputed Mark violates Paragraph 3, Article 13 of the 2013 Trademark Law. The court found that the sales evidence, publicity news, comment articles, etc. submitted by the plaintiff could prove that the plaintiff’s “fresh” and “Fuleishi in Chinese” trademarks had a certain degree of popularity on “cosmetics” products through use and promotion. However, after considering the scope of influence and scale of the popularity, the Cited Marks have not yet reached the level of well-known. Therefore, the filing of the Disputed Mark does not violate Paragraph 3, Article 13 of the 2013 Trademark Law.

The third issue is whether the Disputed Mark violates Paragraph 1(vii), Article 10 and Paragraph 1(ii), Article 11 of the 2013 Trademark Law. The plaintiff claimed that the word “fragrance” in the Disputed Mark means “perfume, fragrance” and its use in services such as Class 44 “beauty services and makeup artist services” can easily lead to consumers misunderstanding the content of the services. It is also a direct expression of the designated service. After hearing, the court held that the use of the word “fragrance” in services such as “beauty services and makeup artist services” can easily cause consumers to associate and believe that the services related to the use of the Disputed Mark denotes wonderful enjoyment, but such associations have not yet reach the extent of being deceptive, it does not violate Paragraph 1(vii), Article 10  of the 2013 Trademark Law. In addition, although the Disputed Mark may cause consumers’ associations and imaginations, it is not a direct description of its service, so it does not violate Paragraph 1(ii), Article 11 of the 2013 Trademark Law.

The fourth issue is whether the Disputed Mark damages the plaintiff’s prior trade name rights. The court found that the plaintiff had been selling “fresh/fuleishi in Chinese” brand cosmetics in China since 2012 at the latest. Through continuous publicity and use, its English trade name “fresh” has gained a certain reputation in cosmetic products. The third-party should have known that the Disputed Mark “Freshfragrance” completely includes the plaintiff’s English trade name “fresh” and the two are similar in overall appearance and text composition. The approved services under the Disputed Mark such as “beauty service and make-up artist service” basically overlap with the consumer groups of the “cosmetics” goods for which the plaintiff’s trade name is famous. Thus, the two mark constitute similar goods and services. Therefore, the application for registration of the disputed trademark damaged the prior right of the plaintiff and violated Article 32 of the 2013 Trademark Law.

Finally, the court held that the evidence on record was insufficient to prove that the filing of the Disputed Mark violated Article 4 and Paragraph 1, Article 44 of the 2013 Trademark Law.

2. Infringement of Dyson’s trademarks and unfairly competed with Dyson  was ordered to pay RMB 800,000 in damages

The Sichuan High Court dismissed a trademark infringement and unfair competition dispute brough by the appellant Dyson Technology Chengdu Co., Ltd. (“Dyson Chengdu”) against the appellees Dyson Technology Co., Ltd. (“Dyson”) and Dyson Trading (Shanghai) Co., Ltd. (“Dyson Shanghai”) and upheld the lower court’s judgment.

The first instance court found that: 1. Dyson Chengdu has posted on its website www.hvlsfan.cn, www.daisencd.com, WeChat applet “Sichuan Industrial Ceiling Fan,” and the 1688 platform “Dyson Technology Chengdu Co., Ltd.” store , “Dyson Technology Chengdu Company” (TikTok account xc516) and “Dyson Technology Chengdu Co., Ltd.” (Tiktok account Daisenkejich) and third-party websites the accused infringement marks “Dyson in Chinese” and “Dyson Technology in Chinese” and “DAISEN” for the purpose of selling and promoting its industrial fans. The use of the said logos had played the role of identifying the source of the product and constituted trademark use. The specific products used by Dyson Chengdu were mainly large industrial ceiling fans, which is identical to the ceiling fans approved for use under the “Dyson in Chinese” and “DYSON” trademarks with reg. nos. 6369537 and 6334841 (“Cited Marks”) claimed by Dyson and Dyson Shanghai in Class 11. The “Dyson in Chinese” and “Dyson” logos used by Dyson Chengdu were identical or similar to the Cited Marks. The “DAISEN” mark used by Dyson Chengdu had identical pronunciation as the “DYSON” mark owned by Dyson with only some letters being different. Since the Cited Marks had a high reputation in the relevant industries in China, based on the general attention of the relevant public, the two marks were similar. To sum up, Dyson Chengdu used logos similar to the Cited Marks in identical or similar goods without the permission of Dyson and Dyson Shanghai, which could easily cause confusion among the relevant public and infringed upon the trademark rights of Dyson and Dyson Shanghai. In addition, the first instance court held that the “DS and Design” used by Dyson Chengdu were neither identical nor similar to the Cited Marks, so it did not support the trademark infringement claim based on it. 2. The main part of the www.daisencd.com domain name registered and used by Dyson Chengdu in March 2021 is similar in pronunciation and spelling to the Cited Marks, which was enough to cause misunderstanding among the relevant public, and Dyson Chengdu has the bad faith intent to deliberately mislead users into accessing its website. Therefore, its actions infringed upon the trademark rights of Dyson and Dyson Shanghai. 3. Dyson Chengdu was registered and established in 2017. As a company that also produces and sells fan products, it should be aware of the popularity of the Cited Marks and the names of Dyson and Dyson Shanghai. However, it still used “Dyson in Chinese” as its company name, which is the same as the Cited Marks. Such actions showed subjective intent to take advantage of the goodwill of others, which may easily cause the relevant public to mistakenly believe that it was related to Dyson and Dyson Shanghai, or there was a specific connection that creates confusion. Therefore, Dyson Chengdu’s use of “Dyson in Chinese” as a corporate name and used words including “Dyson Technology” and “DAISENTECHNOLOGY” in recruitment, bidding and other business activities constituted unfair competition. Accordingly, the first instance court held that Dyson Chengdu should immediately stop the infringing behavior (including stopping using the infringing logo, stopping using and canceling the www.daisencd.com domain name, stopping using the company name with the same or similar words as “Dyson”, and change its company name), post apologies on newspaper to eliminate the impact, and compensation for economic losses and reasonable expenses totaling RMB800,000 (USD112,000).

Dyson Chengdu appealed. The Sichuan High Court found that the key issues in the second instance were 1. Whether Dyson Shanghai has the right to initiate litigation in this case. 2. Whether the accused actions of Dyson Chengdu constitute trademark infringement and unfair competition. 3. Whether the amount of compensation determined by the first instance judgment is appropriate.

Regarding issue 1, the court found that Dyson Shanghai was authorized by Dyson, the trademark owner, to use the Cited Marks within China, and had the right to file lawsuits for infringement of trademark rights, corporate names, etc. According to relevant legal provisions, Dyson Shanghai has the right to initiate litigation in this case.

Regarding issue 2, the Sichuan High Court found that the approved goods for use under the Cited Marks in Class 11, including air conditioning devices, ceiling fans, self-operated fans, etc., are the same as the large industrial fan used by Dyson Chengdu with the infringing logo. They constituted the same goods. Combined with the fact that the Cited Marks enjoys a high reputation in China, Dyson Chengdu used a logo similar to the Cited Marks on the same product, which was enough to confuse the relevant public and constituted trademark infringement. Regarding Dyson Chengdu’s appeal that its use of a legally registered corporate name does not constitute unfair competition, the court found that the evidence on record could prove that Dyson Shanghai has a certain market reputation in its industry and that the “Dyson” brand name is a company name with certain influence. Dyson Chengdu, as a later registered commercial entity that sells fan products like Dyson Shanghai, should be aware of Dyson Shanghai’s well-known status and reasonably avoid it based on the principle of good faith and recognized business ethics. However, Dyson Chengdu did not make any reasonable circumvention when registering its company name, and still used “Dyson in Chinese” in its company name, which could easily cause people to mistakenly believe that it has a specific connection with Dyson Shanghai and has the ability to take advantage of Dyson Shanghai’s good will which constituted unfair competition.

Regarding focus issue 3, Dyson and Dyson Shanghai did not provide evidence to prove the actual losses they suffered due to the infringement, nor the benefits gained by Dyson Chengdu from the infringement. There is no trademark license fee, etc. for reference in this case. The first instance court comprehensively considered the popularity and influence of the Cited Marks, the nature, duration, scope of influence and subjective state of the infringement committed by Dyson Chengdu, as well as the fact that a lawyer appeared in court in this case and the difficulty of the case. The court also considered the evidence collection process, lawyer’s work attitude and workload and other factors. The court finally determined that Dyson Chengdu should compensate Dyson and Dyson Shanghai for a total of RMB800,000 (USD112,000) in economic losses and reasonable expenses, which was not inappropriate.

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