CHINA'S TOP 20 TRADEMARK CASES IN 2017（e-edition）
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China IP magaziine
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Trial Docket: (2017) Zhe 1002 XingChu No. 123
Appellate Docket: (2017) Zhe 10 XingZhong No. 621
Zhejiang Province
[Headnotes]
According to Section 2, Article 67 of Trademark Law of the People's Republic of China, where an act of counterfeiting or producing, without authorization, labels of another's registered trademark, or selling of trademark labels that were counterfeited or produced without authorization has constituted a criminal offense, the infringer shall, in addition to compensating the infringed party for losses incurred, be subject to criminal liability in accordance with the law. According to Section 3, Article 67 of Trademark Law of the People's Republic of China, where an act of knowingly selling goods bearing a counterfeited registered trademark has constituted a criminal offense, the infringer shall, in addition to compensating the infringed party for losses incurred, be subject to criminal liability in accordance with the law.
[Synopsis]
Public Prosecutor : People's Procuratorate of Jiaojiang District, Taizhou City
Defendant: Zheng Xiangchuang and other 12 people
During the period from 2014 to June 2016, the defendants, Zheng Xiangchuang and Zheng Haosheng (handled as a separate case), without permission of the owner of registered trademark, produced series domestic articles and cosmetics under the brand of Amway, and sold such goods to the defendants, Zhang Chuanyou and Li Huixia (handled as a separate case), etc., gaining illegal revenue of up to RMB 1.79 million.
During the period from July 2015 to May 2016, Zhang Chuanyou, one of the defendants, established the warehousing point of sale and sold counterfeit "Amway" series domestic articles and cosmetics purchased from Zheng Xiangchuang, also one of the defendants, gaining the revenue of over RMB 1.3 million, including the revenue of RMB 229,467 from the defendants including Zhang Li and Li Haiyan, etc., resulting in illegal income of RMB 200,000. The public security authority additionally seized counterfeit "Amway" series domestic articles and cosmetics worth over RMB 390,000.
During the period from May 2015 to April 2016, the defendant Duan Junling, without authorization of the owner of registered trademark, purchased raw materials of cosmetics and packing boxes, produced cosmetics of "LANCOME", "CHANEL" and "ESTEE LAUDER" brands with empty bottles for cosmetics printed with "LANCOME" provided by the defendant Liu Youfu and empty bottles necessary for producing other counterfeit cosmetics, and sold counterfeit cosmetics worth about RMB 200,000 to one of the defendant in the same case Zhang Li. The defendant Duan Guangwei furnished the bank card to the defendant Duan Junling for use, and under the instigation of the defendant Duan Junling, delivered and sold counterfeit cosmetics to him and collected partial payment on such goods. The public security authority seized counterfeit cosmetics with sales of over RMB 160,000 from the homes of the defendants Duan Junling and Duan Guangwei.
During the period from 2015 to April 2016, the defendant Zhang Li purchased counterfeit Amway series domestic articles and cosmetics from the defendant in the same case, Zhang Chuanyou, and purchased counterfeit series cosmetics of "LANCOME", "CHANEL" and "ESTEE LAUDER" brands from the defendant Duan Junling; the defendants Zhang Li and Li Haiyan established the point of sale and gained sales revenue of over RMB 60,000 from the defendants in the same case Li Hailong, Li Wei and Duan Yuecui. The public security authority also seized cosmetics and domestic articles of counterfeit "Amway", "LANCOME", "CHANEL" and "ESTEE LAUDER" brands with sales of over RMB 100,000.
During the period from 2014 to March 2016, the defendant Li Hailong, through an online store at Taobao.com operated by him, sold counterfeit "Amway" series domestic articles and cosmetics, gaining revenue of over RMB 170,000, including revenue of over RMB 10,000 from the defendants including Li Wei and others. The public security authority also seized counterfeit "Amway" cosmetics and domestic articles with sales of over RMB 500.
During the period from July or August 2015 to December 2015, the defendants Li Wei and Li Xiancheng, ganging each other, purchased counterfeit "Amway" series domestic articles and cosmetics from the defendants including Li Hai Long and Zhang Li, etc. and sold such domestic articles and cosmetic, gaining the revenue of over RMB 200,000. In the middle and last ten days of December 2015, the defendants Ke Botao, Ke Yunjian and Wang Haibing joined the gang. Until the middle and ten days of February 2016, the defendants Li Wei, Li Xiancheng, Ke Botao, Ke Yunjian and Wang Haibing jointly sold counterfeit "Amway" series domestic articles and cosmetics, gaining the revenue of at least RMB 100,000. Later, one of the defendants Wang Haibing withdrew from the gang and got the illegal income of RMB 13,000. By March 15, 2016, the defendants Li Wei, Li Xiancheng, Ke Botao and Ke Yunjian got the illegal income of RMB 14,500 respectively. The public security authority additionally seized in the warehouse leased by the defendants including Li Wei various types of counterfeit "Amway" series domestic articles and cosmetics that remained unsold and were worth over RMB 119,000.
In the opinion of the People's Procuratorate of Jiaojiang District, Taizhou C i ty, the a c t of the defendants ZhengXiangchuang, Duan Junling, Duan Guangwei and Liu Youfu have constituted the crime of counterfeiting the registered trademarks, and the act of the defendants Zhang Chunayou, Zhang Li, Li Haiyan, Li Hailong, Li Wei, Li Xiancheng, Ke Botao, Ke Yunjian and Wang Haibing have constituted the crime of selling commodities carrying counterfeit registered trademarks. So, the people's procuratorate instituted a prosecution to the court, requesting the court to punish by law.
Through trial, the People's Court of Jiaojiang District, Taizhou City, entered the judgment on April 27, 2017 based on the above facts: the defendants including Zheng Xiangchuang were convicted of the crime of counterfeiting registered trademarks or selling commodities carrying counterfeit registered trademarks and sentenced to fixedterm imprisonment of one year to four years and fined ranging between RMB 20,000 and RMB 900,000; with illegal income recovered. The tools for criminal purpose detained during the investigation were confiscated by the detaining authority Taizhou Public Security Bureau Jiaojiang Branch; the booties as detained were confiscated and destroyed by the detaining authority Taizhou Public Security Bureau Jiaojiang Branch. One of the defendants, Wang Haibing, was forbidden to get engaged in the operation of any online store at Taobao during the probation period for suspension.
After the judgment, the People's Procuratorate of Jiaojiang District, Taizhou City lodged a protest against the judgment for the reasons of wrong applicable laws and inappropriate measurement of penalty due to wrong finding of facts. The defendants in the first instance, Zheng Xiangchuang, Zhang Chuanyou, Duan Guangwei, Liu Youfu, Li Hailong, Li Wei, Li Xiancheng, Ke Botao and Ke Yunjian filed an appeal against the judgment.
Taizhou Intermediate People's Court judged on August 31, 2017 that it permit the appellants (the defendants in the first instance) Zhang Chuanyou and Duan Guangwei to withdraw the appeal; reject the protest and the appeal and sustain the original judgment.
[Judge's Comment]
Since this case involves a lot of persons and covers an extensive geographic region and complex network and the sales channels of counterfeit commodities cover traditional channels and internet platforms, certain difficulties may exist in the determination of crime amount of each defendant. Two courts appropriately apply rules of evidence including distribution of burden of proof and presumption of fact of the case, and in combination with such evidence as defendants' confession, witnesses' testimonials, electronic data regarding internet sales, bank correspondences of the defendants, delivery form, bookkeeping records of the defendants, determine the amounts of illegal operation revenue and il legal income, and realize seamless integration of amount determination among upper and lower levels, thus fighting against violations and crimes effectively and maintaining the impartiality, regulation and author i tativeness of judicial judgment.