On November 8, 2013, Wei PAN, a judge at the Beijing High People’s Court posted the comment and analysis regarding the Ritz-Carlton well-known mark case on China Intellectual Property News. The English translation is for reference and research only.

Well-known Mark Protection shall be Corresponding to Scope of Fame

——-Analysis on the Trademark Dispute Case re Chengdu Zhi Zhi Real Estate Development Co, Ltd. vs The Ritz-Carlton Hotel Company, L.L.C. and the Trademark Review and Adjudication Board

November 8, 2013

China Intellectual Property News

　 Author:　Wei PAN, a judge at the Beijing High People’s Court

                                             (LI SI KA ER DUN in Chinese)　　　　　(RITZ-CARLTON)

　　　                                       Sample 1　　　 　　　　　　　　　 Sample 2

Key Issue of the Case

The recognition of well-known mark shall comply with the principles of recognition based on case by case, recognition based on the party’s request. Where evidence submitted during the Trademark Review and Adjudication Board (TRAB) proceedingis insufficient to prove the well-known status of the mark, the Court may consider the situation of the case and accept the new evidence later submitted during the litigation, and provide the corresponding legal protection consistent with the scope of the mark’s fame.

Case Brief 

The Disputed Mark (see Sample 1) was applied by Chengdu Zhi Zhi Real Estate Development Co, Ltd. (Chengdu Zhi Zhi) on May 9, 2006, and approved for registration on October 14, 2009 inClass 36 on “Residential houses sales services, Real estate agencies, Brokerage, Guarantees, etc.”, with October 13, 2019 as the expiration date of registration.

The Cited Mark 2 (see Sample 2) was applied by The Ritz-Carlton Hotel Company, L.L.C. (Ritz-Carlton) on April 20, 1994, and was approved for registration in Class 42 on “Hotel services, Restaurant services, including grill rooms, Snack-bars, Bars, and Tea room services”, with August 6, 2020 as the expiration date of registration.

On March 28, 2010, Ritz-Carlton filed cancellation application against the Disputed Mark before the TRAB. On August 29, 2011, the TRAB rendered the No. 19220 decision and held as follows: Considering all evidence provided by Ritz-Carlton, it can be affirmed that Ritz-Carlton established Shanghai Portman Ritz-Carlton Hotel before the registration of the Disputed Mark. From 2001 to 2005, Ritz-Carlton was awarded the prizes of “The Best Employers in Asia” and “The Best Employers in China” for three times. Evidence provided by Ritz-Carlton can prove there are many reports about Ritz-Carlton Hotel, LI SI KA ER DUN in Chinese, and RITZ-CARLTON by Chinese domestic media before the registration date of the Disputed Mark. The registration of the Disputed Mark did not violate Article 10(1) (8) and Article 41(1) of the Chinese Trademark Law,therefore Ritz-Carlton’s argument cannot be supported. Ritz-Carlton did not submit evidence that can prove it has been using the mark LI SI KA ER DUN in Chinese designated under identical or similar services to the “Residential houses sales services; Real estate agencies” which are designated under the Disputed Mark, and had gained certain fame. The designated services under the Disputed Mark are different from the hotel industry Ritz-Carlton engages in, so the registration of the Disputed Mark on these services will be unlikely to cause confusion among the public as to the source of the services, and does not constitute infringement upon the trade name right of Ritz-Carlton and its affiliated companies. In sum, the TRAB ruled that the Disputed Mark shall be maintained for registration under Article 43 of the Chinese Trademark Law.

Ritz-Carlton was unsatisfied with the TRAB decision and brought an administrative litigation before the Beijing First Intermediate People’s Court. During the first instance, Ritz-Carlton supplemented relevant evidence. According to the evidence Ritz-Carlton provided before the TRAB, it can be established that before the application date of the Disputed Mark, Ritz-Carlton has established the Shanghai Portman Ritz-Carlton Hotel, which maintains a leading status in the hotel industry. In 2004 and 2005, for two consecutive years, Shanghai Portman Ritz-Carlton Hotel was awarded “Top 10 Popular Business Hotels in China” of China Hotels Golden-Pillow Award. In 2005 and 2006, Shanghai Portman Ritz-Carlton Hotel was nominated for the prizes of “Top Hotels in China” and “Top Resorts in China” by Travel and Leisure magazine. In addition, a large amount of famous media in China and abroad have widely reported LI SI KA ER DUN in Chinese and RITZ-CARLTON. On April 21, 2008, the Shanghai Second Intermediate People’s Court held in a civil judgment as follows: The Portman Ritz-Carlton, Shanghai was established in 1998 and uses the RITZ-CARLTON mark in business operations. According to its official website, the Portman Ritz-Carlton, Shanghai has become a platinum five-star hotel awarded by the China National Tour Bureau, and this award is the highest award in the travel and hotel industry in China. Ritz-Carlton Financial Street Beijing and Ritz-Carlton China Central Place Beijing also use the RITZ-CARLTON mark in business operations.

Court Decision

The Beijing First Intermediate People’s Court held as follows: According to the evidence submitted by Ritz-Carlton, this Court hereby recognizes Ritz-Carlton’s mark RITZ-CARLTON on “Hotel services and Restaurant services” as well-known mark. The registration of the Disputed Mark on services of “Residential houses sales services; Real estate agencies” tend to mislead the public and prejudice the rights or interests of Ritz-Carlton. According to Article 54(2) of the Administrative Chinese Procedure Law, this Court hereby holds the following: (1) Revoke the TRAB decision No. 19220; and (2) The TRAB shall render a new decision on the trademark dispute. Chengdu Zhi Zhi was not satisfied with the first instance court decision and appealed. The Beijing High People’s Court rendered the final decision rejecting Chengdu Zhi Zhi’s appeal and sustaining the first instance court decision.

Analysis

The key issue in this case is how to recognize the well-known mark based on case by case and how to grant the legal protection with appropriate scope.

First, the recognition of well-known mark shall follow the principles of recognition based on case by case, recognition based on the necessity, and recognition based on the party’s request. In this specific case, the grounds argued by Ritz-Carlton involve Article 10(1)(8), Article 41(1), Article 31 and Article 13(2) of the Chinese Trademark Law. The Court holds that the Disputed Mark’s registration does not fall under the situations prescribed by Article 10(1)(8) and Article 41(1) of the Chinese Trademark Law; the Disputed Mark is approved for “Residential houses sales services; Real estate agencies”; and the evidence submitted by Ritz-Carlton fails to prove that certain fame has been obtained by Ritz-Carlton’s trademark in the aforesaid scope of services, and it fails to prove that the Disputed Mark used on the aforesaid services will cause prejudice to the trade name right of Ritz-Carlton who engages in hotel services. Based on above and the party’s request, the Court considered to apply Article 13(2) of the Chinese Trademark Law to determine whether the Disputed Mark should be maintained for registration, which is in conformity with the aforesaid basic principles to recognize well-known marks.

Second, there are different views between the TRAB and the Court as to whether the Cited Mark RITZ-CARLTON should be recognized as a well-known mark. The direct reason for this issue is the large amount of evidence supplemented by Ritz-Carlton during the administrative litigation proceeding. In the administrative litigation proceeding, the Court does not necessarily accept all the evidence later supplemented by the parties during the litigation proceeding. In this specific case, the evidence supplemented by Ritz-Carlton is to strengthen the evidence submitted during the trademark review and adjudication process. It would seriously affect Ritz-Carlton’s rights and interests if those evidence were not to be accepted. Especially when comprehensively considering the evidence submitted during the TRAB proceeding and litigation proceeding, the Cited Mark RITZ-CARLTON may be recognized as well-known mark, it would probably violate the principle of fairness and justiceif the supplemented evidence were not accepted. As there are changes for evidence which causes that TRAB decision is revoked, the Court held that Ritz-Carlton shall be liable for the litigation fee of the first instance.

Well-known mark protection is a stronger protection of cross-Class, but it does not cover all-Class protection. Even if a mark is recognized as well-known, such stronger protection shall be entitled only within the corresponding scope. In this specific case, the Cited Mark designated under “Hotel services, Restaurant services, etc.” is recognized as well-known mark. The approved services designated under the Disputed Mark include “Residential houses sales services; Real estate agencies.” The Court holds that these two services are related to the hotel services. Therefore, the Court ruled that the registration of the Disputed Mark on “Residential houses sales services; Real estate agencies” is likely to mislead relevant public and accordingly prejudice Ritz-Carlton’s rights and interests. However, other services under the Disputed Mark are not incorporated into the protection scope of well-known mark.