Weekly China Trademark News Updates

May 24, 2023

1. “Adidas” was recognized as a well-known mark and successfully fended off “qdidas”

Disputed Mark Reg. No. 19502292	Cited Mark 1 Reg. No. 71092	Cited Mark 2 Reg. No. G1037620	Cited Mark 3 Reg. No. 3336263

The Beijing High Court recently concluded an administrative trademark invalidation dispute between the appellant Tianjin Jiuhong Bicycle Co., Ltd., (“Jiuhong”), the CNIPA, and Adidas Co., Ltd. (“Adidas”). The appeal was dismissed, and the first instance court judgment upheld.

The issue in this case is whether the Disputed Mark violated Article 13, Paragraph 3 of the 2014 Trademark Law. The court found that: based on the evidence in the case, it can be proved that the Cited Mark 1 has been widely known to the public on clothing and other goods before the Disputed Mark’s application date and constituted a well-known mark. According to the need-based determination principle of well-known marks, the courts will only determine whether a trademark is well-known when it is really necessary. This court has protected the rights and interests of Adidas by affirming that the Cited Mark 1 is a well-known mark, and will not comment on whether the Cited Marks 2 and 3 constituted well-known trademarks.

The Disputed Mark is composed of English letters “qdidas”, the Cited Mark 1 is a word trademark composed of uppercase English “ADIDAS”. The Disputed Mark and the Cited Mark 1 are relatively similar in terms of word composition, pronunciation, meaning, appearance, etc. It constituted a copy or imitation of the Cited Mark 1. Although “bicycle; trolley” and other goods approved for use under the Disputed Mark and “clothes” goods for which the Cited Mark  is well-known are not similar goods according to the CNIPA Goods and Services Classification, they overlap in terms of sales channels and consumer groups, which belong to goods with a high degree of correlation. Considering factors such as the distinctiveness and popularity of the Cited Mark 1 and the degree of imitation of the Disputed Mark, the use of the Disputed Mark on “bicycles; trolleys” and other goods was likely to cause the relevant public mistakenly believe that the Disputed Mark and the Cited Mark have a certain degree of connection, thereby weakening the distinctiveness of each Cited Mark, improperly using the market reputation of the Cited Marks, and causing the interests of Adidas to be affected and damaged. Therefore, the first instance judgment and the sued ruling determined that the registration of the Disputed Mark violated the provisions of Article 13, Paragraph 3 of the 2014 Trademark Law was not wrong, and this court affirmed. The relevant grounds of appeal of Jiuhong cannot be established and should not be supported.

2. Nike successfully invalidated the “Swoosh & M & Design” mark

Disputed Mark Reg. No. 30399446	Cited Mark 1 Reg. No. 991722	Cited Mark 2 Reg. No. 4581865

The Beijing High Court recently concluded an administrative trademark invalidation dispute between the appellant Shanghai Jingnai Apparel Co., Ltd. (“Jingnai”), the CNIPA, and Nike Innovation Co., Ltd. (“Nike”). The court dismissed the appeal and affirmed the first instance judgment.

The Beijing High Court found that “clothing, shoes, socks” and other goods approved for use under the Disputed Mark and “clothing, shoes, hats” and other goods approved for use under the Cited Marks 1 and 2 fall into the same subclass according to the CNIPA Goods and Services Classification, constituted as identical or similar goods. The Disputed Mark is composed of the English letter “m” and designs, and the Cited Marks 1 and 2 are design marks. Comparing the Disputed Mark with the Cited Marks, it can be seen that the lower part of the Disputed Mark is highly similar to the design of the Cited Marks. The said marks were similar in design methods and overall visual effects, which constituted similar trademarks. In addition, the evidence submitted by Nike can prove that the Cited Marks already had a high reputation before the application date of the Disputed Mark through its publicity and use. Jingnai did not submit any evidence to prove that the Disputed Mark had formed a one-to-one relationship with the Disputed Mark through use and promotion, and was able to distinguish itself with the Cited Marks. On this basis, if the Disputed Mark and the Cited Marks 1 and 2 coexisted in the market, it would easily cause the relevant public to be confused and misunderstand, or believe that there was a certain relationship between the source of the goods. Therefore, the Disputed Mark and the Cited Marks constituted similar marks on identical or similar goods, and the registration of the Disputed Mark violated Article 30 of the Trademark Law. The original judgment was correct and shall be upheld.

3. The trademark infringer of the “Atlantis in Chinese” mark was ordered to compensate for RMB 1 million

The Hainan High Court recently concluded a trademark infringement and unfair competition dispute between the appellant Hainan Fuda Building Materials Co., Ltd. (“Fuda”), Hainan Atlantis Hotel Management Co., Ltd. (“Hainan Atlantis”), the appellee Kona International Co., Ltd. (“Kona”) and Hainan Zhongrui Huachen Investment Holdings Co., Ltd. (“Zhongrui Huachen“), the defendant in the original trial. The court dismissed the appeal and upheld the first instance judgment.

The issues in this case are: 1. Whether Fuda, Hainan Atlantis, and Zhongrui Huachen, the defendant in the original trial, infringed on Kona’s trademark rights; 2. Whether Fuda, Hainan Atlantis, and Zhongrui Huachen, the defendant in the original trial, have committed unfair competition; 3. If their actions constitute trademark infringement and unfair competition, how should the three companies be held civilly liable.

Regarding issue 1, first of all, Kona registered the “ATLANTIS” mark with reg. no. 5171193, the ” Atlantis in Chinese” mark with reg. no. 6635808, the “ATLANTIS” mark with reg. no. 10940717 and the “Atlantis in Chinese’ mark with reg. no. 14010119 (collectively referred to as the “Cited Marks”), which are approved for use in services such as sales of commercial housing, real estate leasing, management, apartment management, etc. According to the facts ascertained by the first instance court, since 2008, Kona has been publicizing its “Atlantis in Chinese” and “ATLANTIS” marks on Xinhuanet and other media. It has further publicized and reported the Cited Marks when it began to construct and operate the Sanya Atlantis Hotel. The Sanya Atlantis Hotel named after the Cited Marks has won relevant honors successively, with high significance and fame. Second, Zhongrui Huachen and Fuda named their real estate project under development and construction “Atlantis Garden in Chinese” and used “Atlantis in Chinese” and “ATLANTIS” extensively when promoting and selling its project. Such use, in fact, played the role of identifying the project, and it was essentially a commercial mark. The name was exactly the same as the prominent part of the Cited Mark, and the pronunciation was the same, and it was located in Hainan, where the Sanya Atlantis Hotel is located. It will make the relevant public mistakenly believe that there was a certain connection between the real estate project and Kona and its brand services, which would easily mislead the public and confuse the relevant public. Therefore, Zhongrui Huachen and Fuda used Kona’s Cited Marks as the name of its real estate and used it in large quantities in the process of development, construction, publicity and sales, which infringed Kona’s trademark right. In addition, according to the ascertained facts, Kona applied for the registration of the “ATLANTIS” mark in 2006 and the “Atlantis in Chinese” mark in 2008, and made a lot of publicity for the said marks and gained wide popularity no later than 2008. The construction engineering design plan of the “Atlantis Garden in Chinese” project was only approved by the Haikou City Planning Bureau on July 17, 2012. Therefore, the prior use defense of the three companies could not be established.

Regarding issue 2, the Hainan Atlantis Company was a company established by Zhongrui Huachen on November 25, 2013 for the operation and management of real estate projects. Basically, the Hainan Atlantis Company used the same characters as Kona’s already well-known registered mark “Atlantis in Chinese” as its enterprise name and used “Atlantis in Chinese” in a large number of daily operations and promotional activities. The “Atlantis in Chinese” mark would easily made the relevant public mistakenly believe that the three companies and the real estate projects developed by them have a specific relationship with Kona. Therefore, it constituted unfair competition and should bear corresponding civil liabilities.

Regard issue 3, the assumption of infringement liability, Kona requested the three companies to stop infringing its Cited Marks, stop using the Cited Marks in all commercial publicity and activities including but not limited to the “Atlantis in Chinese” in real estate project site, brochures and WeChat public account, and requested the Hainan Atlantis Company to immediately stop unfair competition and change the company name. The changed company name must not contain the word “Atlantis in Chinese” based on factual and legal basis. The first instance court supported Kona’s requests according to the law. Regarding the liability for compensation, because Kona did not provide evidence to prove the economic losses it suffered due to the infringement, nor did it provide evidence to prove that Zhongrui Huachen, Fuda and Hainan Atlantis gained unjustified benefit, the first instance court comprehensively considered factors such as the popularity and influence of the Cited Marks, the nature and degree of infringement by the three companies, the time of infringement and the degree of subjective fault, and the reasonable expenses paid by Kona in this case, it was not inappropriate to determine that the three companies should compensate Kona for economic losses and reasonable expenses of RMB 1 million (USD141,747).

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