Weekly China Trademark News Updates

June 1, 2022

1. Manufacturers or sellers who use decorative patterns on products should reasonably avoid other’s trademarks

On May 9, 2022, the Supreme People’s Court made a final judgment in a trademark infringement case for Fila Sports Co., Ltd. (“Fila”) against Pengcheng Leather Shoe Store (“Pengcheng Leather”). The Court vacated the first and second instance judgments and ordered the defendant to immediately stop trademark infringement.

The Court found that the accused infringing product in this case was a black sneaker with a “” pattern (“Disputed Mark”) on the heel. First, compare the Disputed Mark with the  mark (“Cited Mark”) with reg. no. 163333, both are English logos containing four letters, of which the two middle letters are exactly the same, and the first and the fourth letter only has a small horizontal difference. There were only minor differences in text composition, fonts, design style, and overall appearance. Second, although Pengcheng Leather marked the logos of “Ri Tai Leather Shoes” and “Ritai” on the shoe boxes, shoe covers, and store recruits, such use did not affect the nature of its use of the Disputed Mark. For the alleged infringing product, the Disputed Mark is not a descriptive feature with special meaning, and the relevant public takes general attention would have difficulty to associate it with its product features or the fact that it’s owned by Pengcheng Leather. The Disputed Mark conveys to the relevant public as an identification function of the product and sources, but not a simple decorative pattern. Decorative patterns should reasonably avoid others’ trademarks. Considering the use of the alleged infringing act, the difference between the Disputed Mark used in the product and the Cited Mark, as well as the distinctiveness and popularity of the Cited Mark, and taking the general attention of the relevant public as the standard, it is easy for the relevant public to misidentify or misunderstand that the source of the alleged infringing goods either came from Fila or had a specific connection with Fila, which may easily cause confusion. The alleged infringement constituted as an infringement of Fila’s trademark right.

2. Unauthorized use of the “Mercedes-Benz in Chinese” mark on auto parts constitutes infringement

The Shanghai Intellectual Property Court recently decided a case involving the appellant Shanghai Tonghe Auto Parts Co., Ltd. (“Tonghe”), the appellee Daimler AG (“Daimler”), and the original defendant Shanghai Tongzhi Auto Parts Co., Ltd. (“Tongzhi”) over a trademark infringement dispute. The court affirmed the first instance court’s judgment.

The first instance court held that Tonghe sold brake pads, filters, pulleys and other auto parts in its stores using the three-pointed star logo, “Mercedes-Benz,” “MERCEDES-BENZ,” and other logos. These said logos and marks were nearly visually identical with Daimler’s, which constituted as identical marks. Compare the “Mercedes-Benz” mark used by Tonghe with Daimler’s “MERCEDES-BENZ” trademark, the only difference was letter case. There was no visual difference between the two marks. Additionally, Tonghe purchased the “three-pointed star” mark from a third-party and affixed them to the outer packaging of the auto parts it sold, which played the role of identifying the source of the goods and constituted as trademark infringement. The labels of Tonghe’s products were marked with the word “Mercedes-Benz in Chinese” and Tonghe’s logo and QR code. Such use on the same goods as Daimler’s could easily cause confusion and mistaken regarding the source of goods, which also can be considered as using an identical mark with Daimler’s registered trademark and constituted as trademark infringement. Finally, the existing evidence was not enough to prove that Tongzhi and Tonghe constituted joint infringement. Accordingly, the first instance court held that Tonghe should immediately stop trademark infringement, publish a statement to eliminate negative impact, and compensate Daimler for a total of RMB800,000 (USD119,500) in economic losses and reasonable expenses. The Shanghai Intellectual Property Court affirmed.

3. The Hangzhou Internet Court publicly hears a case involving “users publishing infringing NFT works”

A few days ago, the Hangzhou Internet Court held a public hearing regarding the dispute between the plaintiff Qi Ce and the defendant a technology company infringing the right to disseminate the work information network. The decision was made in the court ordering the defendant to immediately delete the “Fat Tiger Vaccine” NFT work published on the platform involved, and to compensate Qi Ce for economic losses and reasonable expenses of RMB4,000 (USD600).

The court found that the “Metaverse” platform operated by the defendant as an NFT digital work transaction service platform failed to fulfill its duty of care for reviewing the products sold on its platform, which was objectively at fault. The NFT involved in the case has a Weibo watermark, and the original author of the work involved was indicated in the author column, which indicated obviously infringement. Under the premise that the user constituted infringement, the platform involved failed to fulfill its obligation of review. The defendant knew and should have known that the network user infringed the information network dissemination right but failed to take necessary measures to effectively stop the infringement in a timely manner. There was subjective fault on the defendant and should bear the corresponding as an accomplice.

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