CHINA'S TOP 25 TYPICAL TRADEMARK CASES IN 2016

China IP,[Trademark]

According to the State Administration for Industry & Commerce of the People’s Republic of China, with the increasing trademark brand awareness of the market entities, the number of trademarks applied for registration realized a rapid growth. In the first quarter of 2017, 837 thousand trademarks were applied for registration with an increase of 13.9% on a year-on-year basis; 636 thousand trademarks were registered with an increase of 35.2%. By the end of March, China had accumulated 12.937 million valid registered trademarks. At the same time, trademark cases also drew great attention from all kinds of industries. Therefore, China IP selects some typical cases among the cases recommended by China’s courts at all levels and some famous law firms, and many of the cases involved with foreign enterprises. The following cases may offer some enlightenment and reference to foreign enterprises when they are doing or planning to do business in China.
CASE 1: INVALIDATION ACTION AGAINST A COPYCAT OF FRENCH GI
◆ Case No.: (2016) Jing 73 Xing Chu No. 130
◆ Beijing Municipal
◆ Case Type: Civil Case
 
[Keywords]
The Trademark Review and Adjudication Board and the Beijing Intellectual Property Court invalidated a copycat of an unregistered French GI in China by invoking the Article 10.2 (foreign geographical name known to the public is prohibiting from being registered as a trademark) and Article 10.1.8 (unhealthy influence) of the 2001 Trademark Law.
 
[Synopsis]
The INSTITUT NATIONAL DE L'ORIGINE ET DE LA QUALITE (previously known as Institut National des Appellations d'Origine - INAO) is the French government bureau regulating agricultural products with Protected Designations of Origin (PDOs). INAO forms part of the French Ministry of Agriculture.
Margaux is a wine growing region and appellation d'origine contrôlée (controlled designation of origin) within Haut-Médoc in Bordeaux, the world's wine capital. Margaux is the name of the village situated in the middle of this production area, and its leading "chateau" is also called "Chateau Margaux".
On April 26, 2012, a local winery in China called Yantai Médoc Chateaux Wine Ltd. (烟台梅多克庄园葡萄酒有限公司) applied for the registration of "玛歌·鹰贵" trademark (Margaux Yinggui in Chinese) in class 33, covering goods of aperitif, wine, liqueur, alcoholic beverage (excluding beer), sparkling wine, brandy, etcetera. The mark was registered on July 28, 2013.
On December 30, 2014, INAO brought before the Trademark Review and Adjudication Board (TRAB) an invalidation action against such trademark, on the ground that Margaux is a French geographic indication (Article 16) and a foreign geographical name known to the public (Article 10.2) that the registration of the disputed mark has "other unhealthy influence" (Article 10.1.8).
The TRAB partially dismissed INAO’s arguments by finding that Margaux was not registered as a geographic indication in China and that INAO failed to adduce sufficient evidence to prove that Margaux fulfilled the substantial requirements of a GI as outlined in Article 16.2 of the 2001 Trademark Law (since the disputed trademark had been registered in 2013, before the entry into effect of the third revision of the law). However, the TRAB held INAO’s remaining ground (unhealthy influence and foreign geographical name) was tenable and ruled to invalidate the disputed mark on November 19, 2015.
The TRAB invalidation decision was upheld by the Beijing Intellectual Property Court on July 27, 2016.
The court echoed the TRAB reasoning that:
1) "Margaux" is a well-known wine producing region in France and a foreign geographical name known to the public;
2) The first part "玛歌" of the litigious mark is the Chinese transliteration of “Margaux”;
3) The litigious mark contains the Chinese transliteration of Margaux and has not attained a distinctive meaning other than the meaning of its geographical name component;
4) The use of the litigious mark in respect of wine is likely to mislead the relevant public to misconstrue that the wine comes from the French place called “Margaux” which is likely to cause "unhealthy influence".
The court invoked Article 10.2 (foreign geographical name known to the public is prohibiting from being registered as a trademark) and Article 10.1.8 (unhealthy influence) of the 2001 Trademark Law to invalidate the mark.
 
[Judge's Comment]
The case is interesting because the court gave some explanation in its judgment:
1. Article 10.1.8 of the 2001 Trademark Law is customarily used as a fall back provision if there is no other absolute ground for brand owners to rely on. The 2001 Trademark Law also contains an Article 10.1.7 about trademarks that are deceptive because they "have the nature of exaggeration and fraud in the advertising of the goods". But for trademark considered as deceptive but without the "exaggerated advertising" situation, Article 10.1.8 was indeed the convenient fall back. This legislative gap has been filled in the third amendment of the Law with deletion, in Article 10.1.7, the exaggerative prerequisite and only refers to "deceptive" trademarks.
2. With respect to Yantai Médoc’s counterargument citing the exception clause at the end of Article 10.2 (“Where a trademark using any of the above mentioned geographical names has been approved and registered, it shall continue to be valid”), the Court states that such clause was firstly introduced in the 1993 Trademark Law which means that it was only applicable to those geographical name trademarks that had been registered before the implementation of the 1993 Trademark Law. Therefore, this exception could not apply to the disputed trademark which had been registered in 2013.
The case is included as one of the exemplary cases released by the Beijing IP Court at the press conference for its two-year anniversary.
The case is still pending, as Yantai Médoc later appealed before the Beijing High Court.
WAN HUI DA - PEKSUNG represented INAO in the above procedure.
 
CASE 2: ROYAL SALUTE 3D TRADEMARKS GRANTED JUDICIAL PROTECTION FOR THE FIRST TIME IN CHINA
◆ Case No.: (2015) E Wu Han Zhong Zhi Chu Zi No. 00022
◆ Hubei Province
◆ Case Type: Civil Case
 
[Keywords]
In China, it is difficult for a 3D trademark to get protection, especially judicial protection. The recognition of infringement on 3D mark is a highly controversial issue when the 3D mark itself is also the shape of the bottle, as consumers – as well as some People’s Courts - tend to treat the bottle as container or packaging rather than as the trademark that can indicate the source of the products. In this case, Chivas submitted sufficient evidences of use of the 3D marks, proving that consumers actually treat the bottle of “Royal Salute” as a trademark, and are able to distinguish the products from others through the shape of the bottle only.
 
[Synopsis]
Royal Salute is a brand of Scotch whisky produced and launched by Chivas Brothers in tribute to Queen Elizabeth II on the day of her coronation. Named after the traditional 21-gun salute, the premium Scotch whisky is aged for a minimum of 21 years.
Chivas Holding (IP) Limited (“Chivas”) owns 4 three-dimensional (3D) registered trademarks of the bottle shape of Royal Salute whisky in class 33, covering the goods of alcoholic beverage, whisky, wine, aperitifs, etc. The four marks are almost identical, except for their designated colors: ruby, sapphire, emerald green, and no designated color.
 
Royal Salute 3D Trademark (emerald green)
 
Royal Salute whisky bottle shape embodying different 3D marks (designated color)
 
Yantai Ao Wei Wine Ltd. (Ao Wei), a repeat infringer caught the attention of Chivas when it started making and selling an “Elysee 21 YO” whisky which was the obvious copycat of Royal Salute.
 
Royal Salute
 
Elysee 21 YO
On December 26, 2014, Chivas brought a lawsuit against Ao Wei and a local retailer in Wuhan before the Wuhan Intermediate Court on grounds of trademark infringement and unfair competition.
The Court scrupulously compared the bottle shape of the accused products with those of plaintiff’s 3D marks and found that other than a trivial difference, they are visually identical. The Court further confirmed that the plaintiff’s 3D mark is highly distinctive. Even though Ao Wei did use its registered trademark “ELYSEE” on the accused products, such use did not modify the Court’s finding on trademark infringement.
The Court held further that Royal Salute whisky has long history and is widely distributed in terms of geographical coverage. Chivas has invested heavily in its advertisement and promotion so that the product is reputable and is known by the relevant public. Therefore, the product may be considered as a wellknown commodity as provided by the Anti-Unfair Competition Law.
The packaging of Royal Salute is so distinctive that it can serve as source identifier and constitute a specific packaging. The packaging of the accused products is similar to that peculiar packaging, which is likely to cause confusion and misidentification among the relevant public, about the source of the products. The Court rendered a judgment on April 6, 2016, granting an injunction and damages for an amount of RMB 500,000.
WHD - PEKSUNG Group represented Chivas in the litigation.
 
[Judge's Comment]
The case is interesting not only because the Court recognized the trademark infringement based on the shape of the bottle registered as a 3D trademark, but also because it did not limit its finding to this analysis. The court also charaterised the shape of the bottle as a "unique and well-known decoration of a commodity", as provided in the Anti- Unfair Competition Law. It was a sort of back-up statement: even if it could be argued that the shape of the bottle should not be protected under the Trademark Law, the shape was also protected by the Anti-Unfair Competition Law. The judgment was therefore fully justified, and provides different perspective of the legal protection of the shape of bottles.
 
CASE 3: THE DISPUTE ON TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION OF CROSS-BORDER ONLINE SHOPPING
◆ Case No.: (2015) Chao Min (Zhi) Chu Zi No. 46812 (first instance effective)
◆ Beijing Municipal
◆ Case Type: Civil Case
 
[Keywords]
In cross-border online shopping business activities, the definition of E-commerce operators, that is, whether they are manufacturers or sellers, have different explanations in the judicial trial, leading to different legal responsibilities. The trial of this case identified that E-commerce operators are sellers, not manufacturers.
 
[Synopsis]
Plaintiff: Shanghai HappyFamily Culture Communication Co., Ltd. (Shanghai HappyFamily Company)
Defendant: Beijing Beilou Technology Co., Ltd. (Beijing Beilou company)
Shanghai HappyFamily Company was transferred and obtained the exclusive right to use the registered trademark of "" and "HAPPY BELLIES". Beijing Beilou Company use "" and "HAPPY BELLIES" logos in the products sold in Metao website (domain name: metao. com) which the company operate and the products sold are all with American origin packaging, without Chinese label.
After review, the court considered that, according to the provisions of the Trademark Law, the prerequisite of trademark infringement of sales behavior is that the goods sold themselves are products which violate the exclusive right of registered trademark. For the goods sold by Beijing Beilou Company, they are authentic goods from the United States (the US). The products sold by Beijing Beilou Company are the same as those whose registered trademark are authorized to be used as "HAPPY BELLIES" by Shanghai HappyFamily Company. Thus, the products constitute infringing goods. Similarly, the products sold by Beijing Beilou Company carry the "" logo which has no significant difference as registered trademark of "" of Shanghai HappyFamily Company in terms of pattern and line styles. Those two trademarks satisfy the category of similar trademarks, in addition, they are applied in the same products, which is easy to cause confusion among customers, thus constituting infringing goods in this sense.
 
[Judge's Comment]
With the increasingly popularity of cross-border online shopping, the number of cross-border E-commerce operators who are involved in trademark infringement disputes is also growing. The definition of crossborder E-commerce operators will lead to different legal responsibilities and in judicial practice, people also have different understanding of it. One opinion is that the act brings overseas products to domestic territory, in terms of importing the products, it is a process from nonexistence to existence and should be identified as manufacture behavior. Another view argues that the behavior of E-commerce operators, actually is a sales behavior, and should be determined as sales behavior.
The definition of the legal status of the operator depends on the behavior of the operator. The behavior of E-commerce operators, in essence, is a link in the field of circulation, actually is also a sales behavior. Although in terms of goods, they are transferred from outside to inside the territory. As regards inside territory, the goods really come from scratch, but the behavior is not in essence a production behavior. It is just a part of the production field, rather than in the circulation field.
Trademark has a region character. Inside and outside the territory, jurisdictions are different. Although jurisdiction varies, the definition of the identity of E-commerce operators still shall follow the provisions of Trademark Law of the People's Republic of China. The law provides the legal liability of sellers, and based on the sales behavior, legal status and legal identity are defined.
In the current trend of economic globalization, cross-border online shopping of foreign goods has become a way of consumption for an increasing number of ordinary Chinese consumers. Through this way of consumption, ordinary consumers can choose high quality and cheap goods around the world. The consumption of cross-border online shopping itself is not in violation of the law. Products come to China in this way should be identified as goods with legal source, as long as they are legally produced and sold in the country of origin and they perform legal entry procedures. Beijing Beilou Company’s business behavior follows this model, that is, purchasing goods from overseas and then selling them inside.
Therefore, with regards to the behavior of the E-commerce operators, we cannot determine the behavior of E-commerce operators as the behavior of manufacturer and thus defining the operator as a producer which doesn’t conform to his behavior essence. Therefore, the court confirms that the behavior of E-commerce operators is the sales behavior, rather than production behavior, that is, E-commerce operators are sellers rather than manufacturers.
 
CASE 4: DISPUTES ON TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION BETWEEN TENCENT TECHNOLOGY (SHENZHEN) CO., LTD., GUANGDONG WECHAT INTERNET SERVICE CO., LTD., GUANGDONG WEIQI POWER INTERNET SERVICE CO., LTD., AND CEN WEI HAN
◆ First Instance Case No.: (2015) Fu Shun Fa Zhi Min Chu Zi No. 863
◆ Second Instance Case No.: (2016) Yue 06 Min Zhong No. 3137
◆ Guangdong Province
◆ Case Type: Civil Case
 
[Keywords]
If for the intention of a free ride, the operator registers his enterprise code with the registered trademark of others which was registered earlier and with a certain reputation, and utilizes the enterprise name containing this enterprise code in the same or similar goods or services, which makes the relevant public confused or mistaken, his behavior is in violation of principle of good faith followed by the operators in the market competition and constitutes unfair competition.
When the enterprise code registered by the operator is the registered trademark of others, commodity or service category used is the same as or similar to the category of goods or services approved for use by the registered trademark, the registered trademark shall be used as the basis for the protection without having to identify whether the text of the registered trademark constitutes the unique name of a well-known commodity or service and this serves as a basis for protection.
 
[Synopsis]
Tencent Technology (Shenzhen) Co., Ltd. (Tencent Technology Company) is the right holder of No. 9085979 "WeChat and map" trademark. Tencent Technology Company believes that the highlighted use of "Guangdong WeChat" in its business premise by Guangdong WeChat Company constitutes a trademark infringement. In addition, the enterprise name containing the words of “wechat” registered by Guangdong WeChat Company and publicity language “platform co-created with Taiyan Huishe Union, the only certificated community by Tencent “ used in its website constitute unfair competition. Thus, Tencent Technology Company sued to the court. After review, first instance court believed that the highlighted use of "Guangdong WeChat" characters similar to Tencent’s registered trademark in its office space and the official website by Guangdong WeChat Company infringe the trademark exclusive rights of Tencent Technology Company. Meanwhile, "WeChat" constitutes a well-known commodity (service) unique name. The registration and use of "WeChat", the unique name of Tencent technology Company's wellknown goods (services) as enterprise code, the conduct of Guangdong WeChat Company constitutes unfair competition. The first instance court also confirmed that Guangdong WeChat Company's publicity propaganda constitutes a false propaganda. Guangdong WeChat Company refused to accept and filed an appeal. After the trial, second instance court considered that "WeChat and map" registered by Tencent Technology Company in computer software and other commodities has a high popularity. Guangdong WeChat Company, in recognition of "WeChat" trademark, registered “wechat” as its enterprise code. Subjectively, it deliberately takes advantage of Tencent trademark. Guangdong WeChat Company used enterprise name containing the words of “wechat” when engaged in software and information technology services related business activities, especially when providing Tencent’s “wechat”software-related services, which is easy to make public think the services provided by them have certain connection with Tencent Technology Company, thus causing confusion or misunderstanding among public. Therefore, its behavior is in violation of the principle of good faith followed by the operators in the market competition and constitutes unfair competition. The second instance court dismissed the appeal of Guangdong WeChat Company and affirmed the original judgment.
 
[Judge's Comment]
"WeChat" is a trademark of Tencent Technology Company which enjoys a high reputation. Although the court of first instance protected the rights and interests of Tencent Technology Company from the perspective that "WeChat" constitutes the unique name of well-known service and stopped the infringement, unique name of well-known service, in essence, is also a trademark and generally only when oblige has no relevant registered trademark, will it be used as basis for protection. The second instance court took into account that "WeChat" is the trademark of Tencent Technology Company which has a high reputation and took the registered trademark as the basis for protection of relevant rights and interests. Through identifying that Guangdong WeChat Company’s conducts to register and use Tencent Technology Company’s wellknown trademark as enterprise code constitutes unfair completion, the rights and interests protection of obliges are strengthened, normal market competition order is maintained and embodies the strict protection of the judicial value orientation of intellectual property rights.
 
CASE 5: DISPUTE ON TRADEMARK INFRINGEMENT OF GUANGZHOU XX BUSINESS DEVELOPMENT CO., LTD. AND GUANGZHOU XX INTERNATIONAL FREIGHT AGENT CO., LTD, APPEALED BY PUMA EUROPEAN COMPANY
◆ Case No.: (2016) Yue 0112 Min Chu No. 799
◆ Guangdong Province
◆ Case Type: Civil Case
 
[Keywords]
Tourism shopping exports as an emerging way of foreign trade is essentially different from personal consumption made by foreign tourists traveling in China. It belongs to the scope of business and should be subject to the adjustment of intellectual property laws and regulations.
 
[Synopsis]
Plaintiff Puma European Company (Puma Company) claimed that their trademark enjoys a high degree of visibility and good market reputation in the world. Without the legal authorization of the plaintiff, the defendant sell and export presumably the products with same or similar logo as Puma, which severely infringe plaintiff's registered trademark exclusive right and should CASE 5 : DISPUTE ON TRADEMARK INFRINGEMENT OF GUANGZHOU XX BUSINESS DEVELOPMENT CO., LTD. AND GUANGZHOU XX INTERNATIONAL FREIGHT AGENT CO., LTD, APPEALED BY PUMA EUROPEAN COMPANY ◆ Case No.: (2016) Yue 0112 Min Chu No. 799 ◆ Guangdong Province ◆ Case Type: Civil Case bear the corresponding responsibility according to the law. They request the court order: 1. The defendant and the third person jointly compensate the plaintiff pecuniary loss of 500, 000 yuan. 2. The defendant and the third person make a public apology on Guangzhou Daily to eliminate the impact. 3. The defendant bears the cost of litigation in this case.
The defendant Guangzhou XX Trading Co., Ltd (Trading Company) and the third person Guangzhou XX International Freight Agent Co., Ltd. (Freight Company) said that, 1. The alleged infringing goods in this case are goods exported in the way of "tourism shopping goods". The third person and the defendant make cooperation in accordance with the law and the defendant owns business qualification to carry out "tourism shopping goods", while the third party acts as an agent to declare to the customs according to the law. The defendant and the third person have no wrong done. 2. The alleged infringing goods are provided by clients and the defendant and the third person didn’t implement violations of the trademark rights as "production" or "sales" etc. 3. 500,000 yuan claimed by plaintiff has no factual evidence. 4. The plaintiff’s claim has exceeded time limitation, not protected by law.
Huangpu District Court, according to the existing evidence determined that the defendant Trading Company is qualified to export "tourism shopping goods" and provided two stamps of “Guangzhou XX Business Development Co., Ltd” and “Guangzhou XX Business Development Co., Ltd. customs declaration special stamp” to the third person Freight Company to declare customs of "tourism shopping goods". When the third person made export declaration for "tourism shopping goods" involved in this case, after investigation, customs found out that the products involved are in the infringement of the plaintiff’s Puma trademark products.
Huangpu District Court said that the goods declared export by defendant are "tourism shopping goods", and the defendant adopted the “non-selfemployed”in the export of tourism shopping which is in line with the provisions of Article 57 (6) of the Trademark Law regarding contributory infringement, thus infringing plaintiff's trademark exclusive right. The third person and the defendant constitute a joint infringement, and should bear joint and several liability.
Finally, the two parties reached a settlement agreement and the defendant Trading Company shall make a lump sum payment of 300,000 yuan to the plaintiff Puma Company, otherwise, the plaintiff Puma Company holds the right to apply to the court for enforcement of 500,000 yuan. Once the settlement agreement comes into force, the plaintiff Puma Company shouldn’t file a lawsuit against the defendant Trading Company and the third person Freight Company. The defendant Trading Company and the third person Freight Company promise no later infringement of Puma's intellectual property rights and interests.
 
[Judge's Comments]
There are two models that Tourism shopping pilot business currently adopts to carry out their business, one is selfemployed model, and another is nonself- employed model. In self-employed model, since foreign trade enterprises purchase goods consigned by foreign buyers and engage in export business, in essence, they belong to sales and export agents and use trademarks in commercial activities. If the purchased goods are products that infringe the trademark rights, they shall be deemed to violate the exclusive right of the registered trademark of others in accordance with Article 57 (3) of the Trademark Law. In the non-self-employed model, if foreign buyer purchase goods that infringe the exclusive right of the registered trademark of others, foreign trade enterprises fail to perform statutory and reasonable duty of care on a subjective intention and provide facilitated condition for the infringement of foreign buyer objectively, they also violate the exclusive right of registered trademarks of others, in line with the provisions of Article 57 (6) of the Trademark Law.
 
CASE 6: DISPUTE ON TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION BETWEEN BURBERRY CO., LTD., BURBERRY (SHANGHAI) TRADING CO., LTD. AND LU BIDA POLO LEATHER GOODS CO., LTD. IN NANHAI, FOSHAN ETC.
◆ First Instance Case No.: (2013) Sui Zhong Fa Zhi Min Chu Zi No. 339
◆ Second Instance Case No.: (2016) Yue Min Zhong No. 564
◆ Guangdong Province
◆ Case Type: Civil Case
 
[Keywords]
1. The alleged infringer maliciously registered the trademark of others as a trademark or design patent, but the trademark and design are in conflict with the prior rights of others and have been invalidated and the alleged infringer’s implementation of trademark or design patent has been regulated by the relevant legal norms. Under this circumstance, the application of alleged infringer does not constitute the unfair completion provided in Article 2 of Anti-Unfair Competition Law of the People's Republic of China.
2. The plaintiff claims that multiple defendants constitute a common infringement. The people's court, by a comprehensive review of the relevant evidence and the facts found that it is with a high degree of possibility that multiple defendants participated in infringement. If the defendants did not file a refutation of the case, common infringement should be identified.
 
[Synopsis]
Burberry Co., Ltd., and Burberry (Shanghai) Trading Co., Ltd. is the exclusive right holder of G732879 and other registered trademark. Burberry Co., Ltd., and Burberry (Shanghai) Trading Co., Ltd believed that the conducts of the four defendants constitute trademark infringement and unfair competition and appeal the court order to stop infringement and a compensation for economic losses of 4 million yuan etc.
The first instance confirmed that the conducts of Lu Bida Company constitute a trademark infringement, and should compensate the plaintiff 3 million yuan for the economic losses and the reasonable expenditure paid to stop the infringement. The plaintiff’s other claims were dismissed. Burberry Company and Lu Bida Company both filed an appeal.
The second instance held that, in terms of joint infringement, Zhang Keming is the trademark registrant and the designer of the design patent of the alleged infringing product, and the manufacturer of the alleged infringing products Lu Bida Company is his affiliated company. Baoluo Company is the trademark registrant of the alleged infringing product. Signatures of Baoluo Company's handbag and warehouse are posted on the external walls of the company's warehouse of the manufacturer of the alleged infringing products Lu Bida Company and Zhang Keming is the legal representative of Baoluo Company. Zhang Keming and Baoluo Company did not submit any evidence of the contrary. Therefore, the second instance confirmed that Zhang Keming and Baoluo Company constitute a joint infringement. With regards to whether the act of applying for the registration of relevant trademark and design patent constitutes unfair competition, the second instance considered that any person is entitled the right to apply for a registered trademark or design patent. If the prior right holder or interested party thinks that the subsequent patent or trademark violates his legal rights, he may request the relevant institution to declare the registered trademark or patent invalid. The patent and trademark applied by the defendant are invalid. If the plaintiff thinks that other trademark or design patent applied by the defendant have infringed its legal right, it shall be settled by the way stipulated in the above-mentioned law. In addition, Anti-unfair Competition Law adjusts the operators in the process of market transaction, however the application and registration behavior does not belong to the market trading behavior, not within the adjustment scope of Anti-unfair Competition Law. Finally, the conducts of the defendant using the trademark or design patent in decoration of alleged infringing products have been identified as trademark infringement, and should not be repeatedly evaluated.
 
[Judge's Comments]
This case is a typical case of trademark infringement and unfair competition. As to whether the application and registration constitute unfair competition, the identification is different in practice. The second instance court took a comprehensive consideration on factors as below: the nature of application right entitled to citizens by trademark law and patent law, Trademark Law and Patent Law on the protection of prior rights and relief, the adjustment scope of Article 2 of the Anti-Unfair Competition Law, the situation of registered trademark applied by the defendant entering into the market, and that the defendant's conduct of using the above-mentioned trademark and design patent in the market transaction process has been identified as infringing, and adjudicated that the application and registration does not constitute unfair competition. Secondly, in practice, trademark joint infringements appear in complex ways. The second instance court does not rigidly adhere to the manufacturer on the label of alleged infringing products, but by analyzing the specific case to identify the relationship between the defendants and their roles in the. As a result, joint infringement was confirmed in accordance with the law which effectively cracking down joint infringement.
 
CASE 7: RETRIAL OF DISPUTE ON TRADEMARK INFRINGEMENT BETWEEN APPLICANT JIANGSU BROADCASTING CORPORATION, SHENZHEN ZHENAI NETWORK INFORMATION TECHNOLOGY CO., LTD. AND THE RESPONDENT JIN AHUAN
◆ First Instance Case No.: (2013) Shen Nan Fa Zhi Min Chu Zi No. 208
◆ Second Instance Case No.: (2015) Shen Zhong Fa Zhi Min Zhong Zi No. 927
◆ Retrial Case No.: (2016) Yue Min Zai No. 447
◆ Guangdong Province
◆ Case Type: Civil Case
 
[Keywords]
1. To determine whether the logo alleged is used as a trademark rests on whether the use of the relevant logo is to indicate the source of the relevant goods/services, and enable the relevant public distinguish different goods/ services provider. The logo alleged in this case was repeatedly used or highlighted in many commercial activities, and was highly significant, enabling the public to think of the program and its providers, and acting as indicating a source of goods/ services.
2. When determining whether a TV program is the same or similar to a certain service category, the overall and main features of the program should be examined comprehensively, to grasp the nature of the conduct, and make a comprehensive, reasonable and correct review and identification.
3. The scope and strength of protection of registered trademarks should be consistent with the contributions made by the right holders to the prominence and visibility of the trademark. On this basis, the possibility of confusion and misinterpretation of the relevant public is taken into account.
Reasons for recommendation:
The case is a typical case of trademark infringement disputes involving TV programs, attracting extremely high social attention. There is no uniform standard in the judicial practice for the nature of the name of the TV program, the type of service and so on. The retrial carried out indepth analysis of above issues and proposed judicial judgments based on the program as a whole and its main features, the nature of the act to determine the purpose of the relevant services, content, methods and objects. In addition, it closely linked to the principle of Trademark Law and made judgments of infringement or not. This case is a good demonstration of trials of such cases, and also vividly interprets the judicial policy adapting to the strength of judicial protection and innovation of intellectual property rights, achieving the best balance between protecting the legitimate rights and interests of trademark holders and promoting the prosperity and development of cultural industry.
 
[Synopsis]
On February 16, 2009, Jin A’Huan applied to the Trademark Office for registration of trademark "". On September 7, 2010, this trademark was approved to be registered on the 45th category, including "dating services, marriage agency" etc. In 2010, Jiangsu TV (JSTV), affiliated to Jiangsu Broadcasting Corporation (JSBC), started a program entitled “Fei Cheng Wu Rao” with the theme of marriage and dating. Zhenai Network selects blind dating candidates for the program and provides advertising marketing services. Jin A’huan brought a lawsuit against JSBC and Zhenai Network on the ground of the infringement of exclusive use of its registered trademark.
 
[Judge's Comments]
JSBC’s use of the logo “Fei Cheng Wu Rao”, judging from the objective use and subjective intentions, belongs to trademark use. When making the judicial judgment whether such TV program falls into the same or similar category of certain service, certain form of expression or a subject content should not be separated from the overall program on a simply or isolated manner. The program as a whole and its main features should be examined comprehensively, to grasp the nature of the conduct, and make a comprehensive, reasonable and correct review and identification. On this basis, the alleged “Fei Cheng Wu Rao” TV program has obvious difference on the category of use in terms of service’s purpose, content, method and subjects with the trademark in this case. The relevant public can clearly distinguish between the two. Therefore, those two cannot be considered as similar services. Even though, they are considered as similar services, the principle of Trademark Law must be firmly liked. Based on the scope and strength of protection of registered trademarks and the contributions made by the right holders to the prominence and visibility of the trademark, take into consideration the possibility of confusion and misinterpretation of the relevant public, thus making the judgment whether it constitutes an infringement or not. As Jin A’huan’s registered trademark is not significant itself, meanwhile, the logo of alleged TV program is different from the registered trademark of Jin A’huan, which makes the related use reasonable, and the TV program is well known to public, the relevant public can clearly distinguish the source of service without misunderstanding or confusion. Therefore, the alleged act doesn’t interfere the identification and differentiation function of registered trademark and does not constitute a trademark infringement.
 
CASE 8: DISPUTE ON TRADEMARK INFRINGEMENT OF NEW BALANCE TRADING (CHINA) CO., LTD. AND GUANGZHOU SHENGSHI CHANGYUN BUSINESS CHAIN CO., LTD., APPEALED BY ZHOU LELUN
◆ First Instance Case No.: Guangzhou Intermediate People's Court (2013) Sui Zhong Fa Zhi Min Chu Zi No. 574
◆ Second Instance Case No.: Guangdong Higher People's Court (2015) Yue Gao Fa Min San Zhong No. 444
◆ Guangdong Province
◆ Case Type: Civil Case
[Keywords]
1. Using the same or similar words of registered trademark of others as enterprise's code and highlighting use of it in the same or similar goods, makes the relevant public misidentify, thus is a violation of exclusive rights of registered trademark.
2. When calculating the amount of compensation for trademark infringement, attention should be paid to the direct causal relationship between the total profits of infringing products made by the infringer and the act of infringement.
 
[Synopsis]
Zhou Lelun owns the registered trademarks of "Bai Lun" and "Xin Bailun"on the 25th category of "shoes". New Balance Company uses the logo "Xin Bailun" in below ways: 1. Use the characters of "Xin Bailun" under the products pictures sold on its online flagship store. 2. Use the characters of "Xin Bailun" on the sales slip. 3. Use the characters of "Xin Bailun" on its official website etc. During the infringement period, New Balance Company made a total net profit of 195.8 million yuan. On the Assets Evaluation Report provided by the third party in the second instance, it records that the Chinese logo of "Xin Bailun" contributed a net profit of 1,458,149.81 yuan to shoes products of New Balance Company.
Zhou Lelun asked to order Shengshi Company and New Balance Company to stop trademark infringement and compensation for Zhou Lelun economic losses of 300,000 yuan and 98 million yuan respectively, etc.
The first instance court said that: the use of "Xin Bailun" logo by New Balance Company in similar products which is same or similar to the registered trademark of "Bai Lun" and "Xin Bailun" owned by Zhou Lelen, leads to the confusion of relevant public and constitutes infringement of exclusive rights of Zhou Lelun’s registered trademark. In the infringement period, New Balance Company made a profit of about 195.8 million yuan. In light of the circumstances, determine its compensation for Zhou Lelun 98 million yuan. On this basis, the court adjudicated that Shengshi Company and New Balance Company cease infringement immediately and compensate for Zhou Lelun’s economic losses of 5,000 yuan and 98 million yuan respectively, etc.
New Balance Company refused to accept, and appealed to Guangdong Higher Court. The second instance court believed that the way New Balance Company used the infringing logo is enough to make public link the logo "Xin Bailun" to its specific goods and mistakenly believe that the infringing logo is the trademark of New Balance Company, thus illegally preventing Zhou Lelun’s right to use his own registered trademark. When Zhou Lelun uses trademarks of "Bai Lun" and "Xin Bailun" in its manufacture and sale of footwear products, the relevant public will have misunderstandings that the trademarks used by Zhou Lelun is a fake trademark of New Balance Company, Zhou Lelun played up to the reputation of New Balance Company and infringed the trademark of New Balance Company. When calculating the amount of compensation, attention should be paid to the direct causal relationship between the total profits of infringing products made by the infringer and the act of infringement. When consumers purchase the products of New Balance Company, what they consider more, are the high reputations of trademarks of “N"、"NB”and "NEW BALANCE" and the good quality contained in their products. The profits made by New Balance Company are not all from the infringement of Zhou Lelun’s "Bai Lun" and "Xin Bailun" trademarks. Zhou Lelun has no right to claim compensation from profits made from New Balance Company’s own trademark reputation or products’ inherent value. Zhou Lelun’s proposal to calculate the amount of infringement based on all products profits during the infringement period is untenable. But from the Assets Evaluation Report issued by the third party and provided by New Balance Company, the amount of profits they made during the infringement period is at least 1.45 million yuan. Therefore taking into account all evidence of this case, especially the factor that the infringement of New Balance Company is subjective and obvious, the second instance court affirmed that New Balance Company shall compensate a total amount of 5 million yuan for Zhou Lelun’s economic losses and reasonable expenditure paid to stop infringement. Then the court sentenced New Balance Company to compensate for Zhou Lelun’s economic losses of 5 million yuan and the rest of the first instance verdicts maintained.
 
[Judge's Comments]
This case deals with the typical issues of determining "reverse confusion" and confirming the amount of compensation in the trademark infringement, that is, the infringement of later trademark user by virtue of its strong economic strength against the trademark which has been registered for use by prior trademark owner with a low visibility. How to determine the amount of damages for the infringement remains uniform in current trial practices and urgently needs to be clarified.
The typical significance of this case lies in: 1. Even for the transnational corporations with strong economic strength, they must also abide by our legal system and respect the intellectual property rights of others; 2. National brand’s development and growth depends on the continuous innovation, management and use of intellectual property rights by the right holders and depends on the strong judicial protection; 3. The case has a positive significance in the exploration of relations between IP market value and the determination of infringement damages. The case has aroused the public attention of the public, the media, experts and scholars, with typical significance.
 
CASE 9: CASE OF DISPUTE OVER ALLIED DOMECQ SPIRITS & WINE LIMITED, PERNOD RICHARD V. BACARDI TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION
◆ First Instance Case No.: (2016) Xiang 01 Min Chu No. 1463
◆ Hunan Province
◆ Case Type: Civil Case
 
[Keywords]
The usage of "百龄坛" trademark on Chinese label violated the trademark proprietor’s willing and damaged the right and benefit as well, which broke the Article 50 of Trademark Law.
Combined with imported products with the trademark "" and information such as PIN, the public can tell the source of products more precisely. The action of getting rid of PIN by the operator, with the purpose of hiding the source of products and malicious intentions to mix with the same domestic category wine products in use of trademark "", which have ot,her sources of production and sales, influenced the recognition of trademark, impeded the quality management of the trademark proprietor, interfered with the quality control right of the trademark proprietor, leading to double damage to related public and trademark proprietor. It broke the 7th Item, Article 57 of Trademark Law. At the same time, the willing of trademark proprietor is to combine parallel imported products PIN with trademark "", but not trademark "百龄坛" as an integration to determine products source.as a result, the action of getting rid of PIN damaged the original parallel product trademark "", but not the recognition function with Chinese trademark "百龄坛".
 
[Synopsis]
Plaintiff: ALLIED DOMECQ SPIRITS & WINE LIMITED Co., Ltd. (ALLIED DOMECQ)
Plaintiff: Pernod Richard China Co., Ltd. (Pernod Richard)
ALLIED DOMECQ SPIRITS & WINE LIMITED registered trademark of No. 3230516 “Bai Ling Tan” and No.7766497 "", which were permitted to be used by Pernod Richard China Co., Ltd. Wine products sold by Bacardi, with the Chinese label of trademark "Bai Ling Tan", were get rid of the PIN by related operator. According to this, ALLIED DOMECQ SPIRITS & WINE LIMITED Co., Ltd. and Pernod Richard China Co., Ltd. filed lawsuit against Bacardi trademark infringement and unfair competition. In the first court instance, Hunan province Changsha municipal Intermediate People’s Court sentenced that the usage of trademark "Bai Ling Tan" on the Chinese label damaged the No. 3230516 trademark "百龄坛", and the action of getting rid of PIN damaged the No. 7766497 "", further identified that the sales action of BACARDI constituted trademark infringement and compensated for 20,000 Yuan (including reasonable rights protection fee). Both parties did not file lawsuit again.
 
[Judge's Comment]
The judgement highlight of this case is that the specific circumstance of the Article 57 Trademark Law, which regulates damage to the owner of trademark, was elaborated from two angles in this case.
The same category with different trademarks by the trademark owner often means that there may be difference in products quality, production and sales source, and products suppliers. That is to say, the owner of trademark use can segment goods or markets according to self demand. After the trademark owner connected with a kind of product and put it into market, this product is closely to various factors such as its related trademark and product decoration etc. it also comes into an exclusive matchup with the trademark owner’s business reputation. As a result, although the Chinese trademark "百龄坛" on the label has the same trademark owner with foreign trademark "", the trademark owner has got the right to determine which trademark to use on one specific product. The usage of trademark is also a kind of management strategy; no one could make trademark use without authorization. The damage of trademark owner’s right of not using is regulated in the 7th item of Article 57, Trademark Law.
As for parallel imported products, combined with imported products with the trademark "" and information such as PIN, the public can tell the source of products more precisely. The action of getting rid of PIN by the operator, with the purpose of hiding the source of products and malicious intentions to mix with the same domestic category wine products in use of trademark "", which have other sources of production and sales, influenced the recognition of trademark, lead to double damage to related public and trademark proprietor. On the one hand, it influenced the recognition function of trademark. On the other hand, it impeded the tracing management of products quality, interfering with the trademark proprietor’s right to control products quality. It broke the 7th item, Article 57 of Trademark Law.
 
CASE 10: CASE OF DISPUTE OVER GUO HE V. HUA YANG TRADEMARK INFRINGMENT
◆ Case No.: (2016) Hu 0115 Min Chu No. 27091
◆ Shanghai Province
◆ Case Type: Civil Case
[Keywords]
This case deals with the judicial review of OEM trademark infringement. In this case, the plaintiff registered trademark of this case after the termination of cooperation, which violated the principle of good faith. The defendant legally accepted orders and exported products to original country, which did not constitute trademark infringement.
 
[Synopsis]
American company GCI, not involved in this case, began to use word mark "GCI OUTDOOR", and triangle shape mark with that words. From the second half of 2002 to April, 2013, GCI delegated plaintiff company Guo He to process outdoor desk-chair with trademark "GCI OUTDOOR". In April, 2013, both side finished cooperation because of contradictions. On April 26, 2013, Guo He company registered trademark "" No. 12496478 on its 20th products of furniture and armchair. On June 4, 2015, GCI placed an order to defendant company Hua Yang, and delegated it to process outdoor chair with certificate. All processed products were limited to export and with American trademark “GCI OUTDOOR” on products. On August, 27, 2015, Hua Yang company applied for export outdoor products with the American trademark “GCI OUTDOOR”, which were seizure by custom. Then, Guo He company filed lawsuit to court and appealed for stopping infringement and compensating 250,000 yuan. In order to prove that it has begun to use trademark "GCI OUTDOOR 及图", Guo He provided signed contract with company out of this case, which showed that the contract date was on June 6, 2000, with the official seal of demand party "China Ning Bo International Cooperation Co., Ltd." However, the company name of Guo he was changed by the original one on February 28, 2003, with which Guo He company had no reasonable explanation. It is obvious that the contract is counterfeit.
Pu dong court held the opinion that American company GCI had got the right of trademark by using it since 2000. From 2002, Guo He company accepted the delegation of GCI and worked for procession. After the termination of cooperation, Guo He company registered the trademark related to this case, which violated the principle of good faith. As a result, there is no trademark infringement for Hua yang company, which accepted the legal delegation of GCI company and took the use of "GCI OUTDOOR" on its outdoor products. All applications were rejected since there is no facts and law basis for Guo He company’s lawsuit. Judgement came into effect, because both party filed no suit again. What is more, the action of Guo He company’s contract forgery violated the good faith principle in civil law regulation. According to this, court made the decision of penalty, which was carried out by Guo He company.
 
[Judge's Comment]
The original equipment manufacture has been an important way of foreign economic cooperation and also has trademark infringement problem, which has become a hot topic in theory and practical field. In this case, the plaintiff registered trademark of this case after the termination of cooperation, which violated the principle of good faith. The defendant legally accepted orders and exported products to original country, which did not constitute trademark infringement. In this case, the decision of penalty was also made for plaintiff, which cracked down the impairment of civil action.
 
CASE 11: CASE OF DISPUTE OVER GUANG ZHOU COMPASS EXHIBITION SERVICE CO., LTD. ETC. V. FAST RETAILING TRADING CO., LTD. (UNIQLO) TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION
◆ First Instance Case No.: (2014) Hu Yi Zhong Min Wu (Zhi) Chu No. 114
◆ Second Instance Case No.: (2015) Hu Gao Min San (Zhi) Zhong Zi No. 97
◆ Shanghai Province
◆ Case Type: Civil Case
 
[Synopsis]
Appellant (original plaintiff): Guang Zhou Compass Exhibition Service Co., Ltd. (Compass Company)
Appellant (original Plaintiff): Guang Zhou Zhong Wei Corperate Management Consulting Co., Ltd. (Zhong Wei Company)
Appellant (original defendant): Fast Retailing Trading Co., Ltd. (UNIQLO)
Original defendant: Fast Retailing Trading Co., Ltd. Chuan Chang Road Store (Chuan Chang Road Store)
Compass company and Zhong Wei company totally have more than 2600 registered trademarks, including "", which is checked for apparel 25. There was high price trademark transfer information on the website of Zhong Wei company. UNIQLO manage apparel, whose subordinator Chuan Chang store sold clothes with the mark of "". Both of the trademark owners filed lawsuit in many courts around the country for the reason of trademark infringement of UNIQLO’s subordinate company. In the first stance, the court held the opinion that there was no difference in vision effect of both trademarks. What is more, commodity also have similarities, which may lead to confusion for the public. However, the court supported that the defendant should stop using this trademark without penalty, because both of the trademark owners did not take it for usage, but for illegal benefits by batch lawsuits. Both parties filed lawsuit again because of disagreement. Shanghai superior court held opinion that besides reasons of the first instance, the trademark "" was not taken into use, so there was no business reputation on it. After stopping trademark infringement, the registered trademark has come back to its original condition. There is no problem for the owner to take it into normal use, and no basis for easing influence and social evaluation. What is more, the compensation is often for economic damage after infringement, while the action under accusation did not lead to any loss. As for rights protection fee, on account of the intention of trademark owner getting multiple compensation and repeated expense of batch lawsuits, which is not in the scope of Trademark Law, so all expenses of batch lawsuits are not supported. In conclusion, lawsuit was rejected, and original judgment was maintained.
 
[Judge's Comment]
The case is the use of registered trademark improper profit in the bulk of malicious litigation cases. The domestic court’s sentence for the first time depends on the rights of the bulk litigation with malicious, and then exempts from the infringer reasonable costs, including the effective compensation obligations. In this case, the right holder took use of the registered trademark bulk litigation to obtain multiple claims subjective malicious obvious, for the bulk fees. The law has ordered the infringer to bear the reasonable expenses of the rights holder's expenditure. It is intended to encourage the active protection of the rights to curb the infringement. At the same time, it is necessary to order the infringer to bear the costs of the infringement on the basis of the infringement. Objectively this kind of malicious batch lawsuits can not be kept down, sentence by exempting reasonable costs from infringer may help oblige take legal rights through proper lawsuits strategy.
 
CASE 12: CASE OF DISPUTE OVER LOUIS VUITTON V. MINISO (FU TIAN), BAOYANG, SAIMAN GROUP TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION
◆ First Instance Case No.: (2015) Shen Fu Fa Zhi Min Chu ZI No. 1058
◆ Guang Dong Province
◆ Case Type: Civil Case
 
[Keywords]
The use of decoration with similar to registered trademarks, but not separately take into use and mark use, do not constitute trademark infringement. Although the goods under accusation took use of other trademark, there were also likelihood of confusion on the public that it might have permission or association with the well-known goods proprietor, which constitutes unfair competition of using specific well-known goods decoration without authorization.
 
[Synopsis]
Plaintiff: Louis Vuitton Defendant: Shen Zhen Fu Tian Miniso (Miniso Fu Tian)
Defendant: Guangdong Bao Yang Investment Management Co., LTD. (Bao Yang company).
Defendant: Guangdong Sai Man Investment Co., LTD. (Sai Man company)
Louis Vuitton filed a lawsuit against infringement and unfair competition, in which Miniso Fu Tian sold products produced by Bao Yang and Sai Man company. The use of "" has the same marks with Louis Vuitton’s registered trademarks, No. G561516 "", No.1106302 "", No. 1106237 "", No. G852773 "" and similarity to No. 241012 "". At the same time, the main obverse design has high similarity to the famous commodity design.
The court held the opinion that the combination of trademarks "", "" and "" did not belong to trademark usage, which did not constitute trademark infringement. However, the action of using similar design with other well-known products without permission of Louis Vuitton, constituted unfair competition, so the defendant should stop infringement and compensate company loss. Other lawsuits of Louis Vuitton were rejected.
 
[Judge's Comment]
The essential function of the trademark is to guarantee the identity of origin of the trademarked product to the consumer or ultimate user. Trademark use refer to take trademark into business activity and for the purpose of distinguishing goods or services origin. Although goods in this case took use of similar design with Louis Vuitton trademarks, the total effect should be checked to make final decision. These similar pictures took on lady handbag design in integrity, which did not meet trademark conditions separately. More often, these separate designs show on themselves decoration function, so there is no trademark infringement.
The essential theory of anti-unfair competition law gives protection to wellknown products decoration is confusion prevention theory. On the one hand, when the use of products decoration can tell the origin of goods and prevent from likelihood of confusion, it should be protected by the law. On the other hand, when the use of an identical or similar sign for similar goods creates a serious likelihood of common origin confusion which includes the confusion of permission of proprietor or specific association, it constitutes a likelihood of confusion even without trademark confusion.
 
CASE 13: CASE OF DISPUTE OVER SHANG HAI BU LAI SI EDUCATION INVESTMENT CO., LTD. V. XI AN YU QING BUSINESS CONSULTING CO., LTD. TRADEMARK INFRINGEMENT
◆ First Instance Case No.: (2016) Shan 01 Min Chu No. 930
◆ Shaanxi Province
◆ Case Type: Civil Case
[Keywords] Even if trademark permitted contract was formed oversees in foreign-related cases, people’s court could make sentence combined with other evidence and cross-examine of involved parties. Unregistered trademark can be given permission as business logo. It is unable to establish that the licensee takes prior use as argument. The party in charge constitutes trademark infringement in using other party’s trademark after contract termination.
 
[Synopsis] American Baby International Education Co., Ltd. (ABIE) applied Trademark Office of State Administration for Industry and Commerce of the People’s Republic of China (Trademark Office) for trademark registration in December 21, 2011, and got registered trademark no. 10335614 “ABIE·C” under category 41 education and training etc. on December 12, 2013, ABIE contracted trademark use permission with Shang Hai Bu Lai Si Education Investment Co., Ltd. (Bu Lai Si company): Bu Lai Si company has the right to use trademark "ABIE·C" for free in china with ABIE’s authorization until December 31, 2019; Bu Lai Si company can give permission and file lawsuit to get compensation. During this period, Bu Lai Si company signed authorization contract with XI AN YU QING BUSINESS COUNSULTING CO., LTD. (Yu Qing company): based on the general authorization contract between ABIE and Bu Lai Si company, Bu Lai Si company authorize Yu Qing company open ABIE center in Xi’an high-tech zone with the use of business number and trademark until October 9, 2015. It constitutes infringement, if Yu Qing company will not destroy copyright materials and trademark of Bu Lai Si company within two weeks after expiry of authority. Thereafter, Bu Lai Si company informed Yu Qing company about the infringement. On March 17, 2016, there were "ABIE" and "爱贝国际少儿英语" on propaganda materials and indicators. Therefore, Bu Lai Si company believed that the act of Yu Qing company constituted trademark infringement, filed lawsuit to court and required sentence: stop infringement; apologize and ease influence; compensate for 60,000 Yuan. Yu Qing company argued that the authority contract of Bu Lai Si company was not notarized; Yu Qing company had prior use right of "ABIE"; "ABIE·C" and “ABIE”were registered separately, which did not constitute similarity.
 
Xi An Intermediate Court believed that it was suitable for Bu Lai Si company to be plaintiff in this case; Yu Qing company’s act of continuing using "ABIE" after termination of authority may lead to confusion and mistake for the public, which infringed exclusive right of trademark "ABIE", hence sentenced: Yu Qing company must stop trademark infringement of No.10335614 "ABIE·C"; Yu Qing company should compensate loss of Bu Lai Si company accounting for 15,000 Yuan; reject other requirement of Bu Lai Si company’s lawsuit.
This case has been legally effective, since there is no lawsuit of both parties after sentence.
 
[Judge's Comment]
This case is foreign-related disputes on trademark infringement, which is triggered by foreign-related trademark use permission contract. Litigant often supply oversees evidence. There is dispute whether oversees evidence without notarization and authentication could be basis to determine facts. The typical feature of this case is that if the evidence formed outside China is approved by the parties, and the other evidence can be confirmed by each other, the people's court can directly determine that there is no need for recertification; there is no clear regulation whether the unregistered trademark could be used as authority commercial logo, there are different views in judicial practice. According to Article 43 of Trademark Law of the People's Republic of China, it seems that if only literally understand “trademark use permission contract", “trademark” may refer to registered trademark, but there is no stipulation that trademark without register could not give permission to other partied. The sentence of this case shows that unregistered trademark can also be permitted to others. In trademark infringement cases, defendant often take prior trademark use as argument, which is made clear about conditions in this case. As for trademark with permission of use right owner, even if permitted party makes prior use, it has not prior use right for some preconditions. This case makes clear about article 9, Trademark Law, and points out there is no legal basis continuing using permitted trademark after contract termination, which constitutes infringement. The deal of this case makes deep interpretation about the deep meaning of Trademark Law, Article 9, Article 42 and Article 43, which has guiding significance to the similar cases in the future.
 
CASE 14: CASE OF DISPUTE OVER CASHBOX PARTYWORLD CO., LTD. V. LONG YOU JIN QIAN GUI ENTERTAINMENT CO., LTD. AND LONG YOU HAO LE DI FITNESS CO., LTD. TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION
◆ Case No.: (2015) Zhe Qu Zhi Chu Zi No. 225
◆ Zhe Jiang Province
◆ Case Type: Civil Case
[Keywords]
There is clear recognition and high reputation of the original trademark, even if it is added other prefix and suffix. When the new one is taken as trademark without authorization, it is still the original trademark’s effect according to common awareness, so the act constitutes trademark infringement.
At the same time, take use of other well-known trademark could lead to confusion of the public, which constitutes unfair competition, so the registered legal company name could not be argument for no infringement and unfair competition.
 
[Synopsis]
Plaintiff CASHBOX PARTYWORLD CO., LTD. (Cashbox company), the registered trademarks No. 779781 "錢櫃CASH BOX", No. 3214677 "錢櫃PARTYWORLD", No. 4003165 "钱柜PARTYWORLD", No. 4003164 "钱柜" and No. 6744917 "CASH BOX 錢櫃K-T-V ", was set up in Taiwan in 1986. The foresaid five trademarks were checked for usage under service category 41.
Defendant Long You Jin Qian Gui Entertainment Co., Ltd. (Jin Qian Gui Company) was set up in 2012, with the legal representative Li xx, and management scope of KTV, prepackaged food. Defendant Long You Hao Le Di Fitness Co., Ltd. (Hao Le Di company) was set up in 2015, with legal representative Li xx, and management scope of fitness service. In the same year, legal representative was changed into Xiang xx.
Cashbox company filed lawsuit in that the action of Jin Qian Gui and Hao Le Di constituted trademark infringement and unfair competition, and asked for sentence of stopping infringement, getting rid off influence and compensating loss and expense accounting for 500,000 yuan.
Qu zhou intermediate court believed that it belonged to trademark use since jin qian gui company took use of " 金钱柜" in outdoor signboard, KTV system, VIP membership card and other services. Although "金钱柜" put " 金" in front of "钱柜", the main mark function is still "钱柜", which is similar to each other. What is more, jin qian gui company served KTV, the same category with cashbox’s registered trademark which enjoyed higher popularity. So, the use of "金钱柜" might lead to likelihood confusion to the public, which constitutes trademark infringement.
Cashbox company was established in 1986, in November 1995 registered No. 779781 "錢櫃CASH BOX" trademark, and has registered the "钱柜" series of trademarks, which has enjoyed a wide range popularity.
Jin Qian Gui company was set up in September 2012, and engaged in the KTV industry. The use of "金钱柜" is similar to "钱柜", which easily lead to likelihood confusion to the public, constitutes trademark infringement.
Jin Qian Gui company argued that its company name was checked by Industrial and Commercial Bureau. The court believed that registered company name was not the certain reason for no infringement and unfair competition.
In this case, combined with evidence that both company have the same legal representative, the action of Hao Le Di company of lending POS machine to Jin Qian Gui for receiving operation income constitutes contributory infringement. As a result, it should take joint compensation liability.
In conclusion, Qu Zhou intermediate court sentenced: Jin Qian Gui company and Hao Le Di company should stop trademark infringement right now; Jin Qian Gui should stop using company name with " 钱柜"; Jin Qian Gui should compensate cashbox company loss and reasonable expenses accounting for 200,000 yuan, While Hao Le Di should take joint compensation liability.
After the sentence of first instance, both sides did not appeal again.
 
[Judge's Comment]
The name of company is a kind of civil right under legal protection, but the operator should follow the principle of good faith in business activity, and should not harm other prior right. In this case, plaintiff company took prior use of "钱柜" and has got good popularity, while the defendant company took similar words as its company name, which easily lead to confusion to the public. Therefore, the legal registered company name is not the certain reason for no infringement and unfair competition.
 
CASE 15: THE TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION DISPUTES OF MATSUOKA ELECTROMECHANICAL (CHINA) CO., LTD. AND QUEYOU TECHNOLOGY CO., LTD. APPEALED BY MATSUOKA ELECTROMECHANICAL (CHINA) CO., LTD.
◆ First Instance Case No.: (2015) Zhe Hang Zhi Chu Zi No. 469
◆ Second Instance Case No.: (2015) Zhe Min Zhong No. 151
◆ Zhejiang Province
◆ Case Type: Civil Case
 
[Keywords]
For the conflicts of trademarks and brands, judgments should be adhering to principles of the protection of prior rights, sincerity and credibility, and the prohibition of confusion.
 
[Synopsis]
There are investor relations among Matsuoka Electromechanical (China) Co., Ltd. (Matsuoka Electromechanical) a n d Zhejiang Matsuoka Electromechanical and Industrial Co., Ltd. (Zhejiang Matsuoka) and Hangzhou Matsuoka Electric Appliances Co., Ltd. (Hangzhou Matsuoka). In 2008, Matsuoka Electromechanical got transferred to obtain No. 1110578 "雀友 QUEYOU" trademark (the main trademark), which is approved in the 28th category of "mahjong" goods. In addition, Matsuoka Electromechanical has also been transferred or applied for a number of registered trademarks related to "QUEYOU".
Queyou Technology Co. , Ltd. (Queyou Technology) was established in 2002, formerly known as "Zhejiang Queyou Entertainment Equipment Co., Ltd.", and renamed in 2011. HU Bin, the legal representative of the company, used to serve as the legal representative of Hangzhou Haixin Electronics Co., Ltd. (Haixin Electronics). Haixin Electronics and Queyou Technology was Zhejiang Matsuoka’s authorized dealer in April 1999, and from March 2002 to March 2005 respectively, selling “QUEYOU” fully automatic mahjong machines. In March 2005, Zhejiang Matsuoka wrote a letter to release the dealership with the Queyou Technology, and informed it to stop using the involved "QUEYOU" registered trademark. HU Bin confirmed. Subsequently, Matsuoka Electromechanical released a clear statement on Qianjiang Evening News for its "QUEYOU" trademark rights, and notified that all business behaviors of Queyou Technology have nothing to do with Matsuoka Electromechanical, and they retain the right of legal liability.
Matsuoka Electromechanical believes that Queyou Technology used of "Queyou Technology", “Made by Queyou Technology” in the production and sale of mahjong machines. Besides, it used "Queyou Technology", "Welcome to Queyou Technology", "Products of Zhejiang Queyou Technology" in exhibitions, promotional materials, product appearance, and other acts of identification, which constitute a trademark infringement. Using other registered trademark as the name of the enterprise misled the public, plus constituted unfair competition. Queyou Technology improperly used Matsuoka Electromechanical’s famous "Queyou" trademark as company name, whether or not highlighted, it could not avoid the confusion in the market. Queyou Technology should stop using or change the name of the company; then, Matsuoka Electromechanical sued it to the court, and requested a decree: Queyou Technology immediately stops trademark infringement; stops using the name of "Queyou" as a company name; confiscates, and destroys infringing products; makes a public apology on the Zhejiang Daily to eliminate the impact; indemnifies an amount of 10 million Yuan for economic losses, and bears the costs of litigation in this case.
Hangzhou Intermediate People’s Court made a decision, affirming the trademark infringement and unfair competition, ordering Queyou Technology to immediately stop trademark infringement; immediately stop using “Queyou” as a company name; destroy the trademark of "Queyou" on mahjong machines; publish an announcement on Qianjiang Evening News to eliminate the impact; ordering Queyou Technology to pay 2 million Yuan to the plaintiff.
After the first instance, Queyou Technology rejected and appealed to Zhejiang Provincial Higher People’s Court.
The Higher People's Court of Zhejiang Province held that the name of "Queyou" used by Queyou Technology is the most recognizable part that could be identified as the company. It highlights the company name, which is regarded as a trademark use. It is easy to confuse the public; thus constitutes a trademark infringement.
The current name of Queyou Technology has obvious subjective malicious, and the behavior is enough to mislead the public, which contraries to the principle of sincerity and credibility and recognized business ethics, damages Matsuoka Electromechanical's prior legal rights, undermines the market fair competition order as well as social and public interests, constitutes unfair competition, and should bear the corresponding civil liability. Whether or not Queyou Technology highlights the use of "Queyou", it is inevitable to cause confusion in the market; it should stop using that name. In conclusion: the court dismissed the appeal and affirmed original judgment.
 
[Judge's Comment]
The following three points are for the facts of the case, the character of the behavior, and the liability of the commitment; besides, they also play an important role in subsequent trials: 1. Trademark, carrying good reputation, is an important component of trademark value; the transfer of ownership of the mark is inherited and enjoyed by the assignee. 2. If the perpetrator knows the right status of the trademark involved, conducts an approximate use rather than a reasonable avoidance, which could be found subjective malicious. 3. Any individual who registers the name of an enterprise shall comply with the rules of fair competition and respect the rights of the prior rights and shall not conceal the purpose of unfair competition in a legal form. If anyone registers a company name that has be already registered as a trademark, even if it follows norms it still causes market confusion, misleads the public, constitutes unfair competition, and should be forced to stop the use of the corresponding name.
 
CASE 16: SIEMENS AKTIENGESELLSCHAFT V. XINCHANG SIEMIVES DOMESTIC APPLIANCES CO., LTD., SHAOXING BANG DAI ELECTRIC APPLIANCE CO., LTD., AND MR. WU. TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION DISPUTES APPEALED BY SIEMENS AKTIENGESELLSCHAFT.
◆ First Instance Case No.: (2015) Zhe Shao Zhi Chu Zi No. 972
◆ Second Instance Case No.: (2016) Zhe Min Zhong No. 699
◆ Zhejiang Province
◆ Case Type: Civil Case
 
[Keywords]
1. In determining the amount of indemnity, we should have comprehensive consideration of the subject of right, the object of right, the subject of infringement and the infringement, and improve the legitimacy, normalization, and predictability of the amount of indemnity.
2. As for shareholders using the company as an infringement tool, trying to use the corporate legal person’s independent personality system to avoid the tortious liability, according to the Tort Liability Law on the provisions of joint infringement, or in accordance with the Company Law on the company shareholders’ abuse of corporate legal person’s independent personality, the shareholders would be ordered to bear joint liability as infringement subjects.
 
[Synopsis]
Siemens Aktiengesellschaft (Siemens) started to do business with China since 1872, and enjoys a high reputation in China. Siemens registered in China, No. G683480 "西门子" registered trademark, and No. G637074 "SIEMENS" registered trademark are identified as well-known trademarks.
Xinchang Siemives Domestic Appliances Co., Ltd. (Xinchang Siemives) was founded in 2014. In the same year, the shareholder Mr. WU holds a ratio of 80%. After Mr. WU registered the domain name "www.siemives.com", he allowed Xinchang Siemives to use it, and sold alleged infringement products. In 2013, Mr. WU applied to the Trademark Office for "SIEMIVES" trademark registration, which was not approved. In the business activities, Xinchang Siemives mixed Mr. WU’s personal bank account with company account. At Shaoxing Bang Dai Electric Appliance Co., Ltd. (Bang Dai) plant, administrative organs sealed up the marked infringement products under the name of "Xinchang Siemives Domestic & Electronic Co., Ltd.". News reported that consumers would confuse kitchen ventilators made by Xinchang Siemives as "SIEMENS" products.
Siemens appealed to the Shaoxing Intermediate People’s Court for a decree: Xinchang Siemives, Bang Dai, and Mr. WU to stop the trademark infringement and unfair competition, and to jointly compensate Siemens for economic losses of 2 million Yuan (including reasonable expenditures to stop the infringement).
Shaoxing Intermediate People’s Court held that Xinchang Siemives used "西门子" in its company name, which is easy to confuse the public, infringing the enterprise name right of Siemens. Xinchang Siemives, and Bang Dai, manufactured and sold products with "SIEMIVES", jointly caused infringement of Siemens registered trademark exclusive right, should bear joint liabilities. However, Siemens did not provide sufficient evidence to prove the mixed use of corporate property between Mr. WU and Xinchang Siemives; thus, Mr. WU is not supposed to bear joint liabilities.
After the first instance, Siemens rejected and appealed. The Higher People’s Court of Zhejiang Province held that Mr. WU subjectively intended to cause infringements with Xinchang Siemives, and objectively has joint forces of the collaboration, resulting in damage to the consequences of the occurrence of the same joint infringement and the two have seriously mixed personality; thus, Mr. WU should bear joint liabilities with Xinchang Siemives and Bang Dai.
The determination of the amount of indemnity depends on the comprehensive consideration of the subject of right, the object of right, the subject of infringement and the infringement. The amount of indemnity determined by the first instance is incompatible with the market value of Siemens’ trademark and the name of the company, and it did not provide the obligee with sufficient judicial remedies nor punish the infringer to pay enough prices for the infringements. On the basis of comprehensive consideration of various above facts, the court of the second determined that the amount of indemnity should be 1 million Yuan.
In conclusion, the second instance court changed the judgment: Xinchang Siemives, Bang Dai, and Mr. WU jointly bear the amount of indemnity (including economic losses and reasonable expenses) of 1.07 million Yuan.
 
[Judge's Comment]
In response to the comments of the "low indemnity for intellectual property rights" among the society, Zhejiang court summarized the trial and practical experiences, and put forward the "judicial analytic hierarchy process" to calculate the indemnity on the basis of economic analysis of law. This case is the first judicial practice of "judicial analytic hierarchy process". Because the infringement of intellectual property is essentially the damage to the market value of the right, the market value of the right depends on the subject of the right and the object of the right; besides, the infringing party and the infringing act are the direct cause of the damage. Therefore, to appropriately put forward assessment factors and levels according to the law and legislation; to evaluate the right party (including the subject of rights, the object of rights) and the infringing party (including the subject of infringement, the infringement) on the basis of the right party information and the infringing level. Finally, to normatively conduct the discretion, and to appropriately determine the amount of indemnity. It is necessary to improve the legitimacy, normalization, and predictability of the amount of indemnity, which is in line with the law of market economy as well as the value orientation of intellectual property legislation.
 
CASE 17: THE DISPUTE ON MACCHI AND BRAY VITI CO., LTD. AND ARISTON THERMAL PRODUCTS (CHINA) CO., LTD. SUING JIAXING ALISIDUN ELECTRIC APPLIANCE CO., LTD. FOR TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION
◆ First Instance Case No.: (2014) Ning Zhi Min Chu Zi No. 1
◆ Second Instance Case No.: (2015) Su Zhi Min Zhong Zi No. 00211
◆ Jiangsu Province
◆ Case Type: Civil Case
 
[Keywords]
1. If the mark actually used by the obligee is only slightly different with its registered trademark, it shall be deemed to use its registered trademark. If the obligee with higher popularity uses multiple trademarks, when the strongly significant Chinese mark and its corresponding mark point to the obligee’s product in the consumers’ cognition, the association of all the business marks will intensify each other and overall promote the obligee’s brand popularity.
2. According to the principles of passive confirmation and individual case confirmation, for the trademark that has indeed reaching the famous degree, if the infringer charged is obviously intended to play up to the obligee’s famous trademark, the famous trademark shall be confirmed.
3. When the enterprise name infringes the exclusive right to use registered trademark and constitutes the unfair competition at the same time, if the infringer charged is obviously intended to play up to the registered enterprise name and the existence of such enterprise name will make their market boundary unclear and trigger confusion at the same time, then the use of such enterprise name shall be stopped.
 
[Synopsis]
Macchi and Bray Viti Co., Ltd. (Macchi Company) obtained permission to register No. G684565 trademark in 1997 and was verified to be used in the Class 11 commodities including the gas cooker, bath water heater and water heater, and it obtained permission to register No. 1255550 trademark in 1999 and was verified to be used in the Class products including the cooking range and bathroom equipment.
In 2000, Macchi Company authorized Ariston Thermal Products (China) Company (Ariston China Company) to use the abovementioned No. 1255550 and No. G684565 trademarks nonexclusively within the territory of China.
Ariston China Company has mainly used No. 1255550 trademark in the water heaters produced and sold by it. With the branches or offices in many cities nationwide, this company has had the huge sales and it has had won various honors for many times so it has had the relatively high popularity.
Founded in 2005, the business scope of Jiaxing Alisidun Electric Appliance Co., Ltd. (Jiaxing Alisidun Company) includes bath heater and water heater.
This company registered the domain name of alisidun.com in 2005; in addition, it successively obtained No. 4852523 trademark and No. 5093449 “ALSDON” trademark verified to be used in Class 11 as well as No. 5298482 “Alisidun” trademark, No.8199907 “ALSDON” trademark and No. 8199995 “Alisidun” trademark used in Class 6 by transfer or registration.
The identifications used by Jiaxing Alisidun Company in the nameplate, manual and package of its integrated ceiling products in different circumstances include: “ALSDON”, “Alisidun Integrated Ceiling”, “Alisidun E3 Autonomous Ceiling” and Jiaxing Alisidun Company’s Chinese enterprise name and its English enterprise names of JIAXING ALISIDUN ELECTRIC APPLIANCE CO.LTD, “FROM ITALY”. On the page top of its website www.alisidun.com, the words “ALSDON” and “Alisidun Integrated Ceiling” are marked, and the enterprise name of Jiaxing Alisidun Company is marked at the bottom.
 
Macchi Company and Ariston China Company request the court to order Jiaxing Alisidun Company to stop the act of infringing the exclusive right to use No. 1255550 and No. G684565 trademarks, to stop using the domain name of “alisidun.com”, to stop using the enterprise name containing “Alisidun” and “ALISIDUN” identification, to stop the unfair competition act of false publicity and compensate the infringement damages.
The court holds that No. 1255550 trademark of Macchi Company shall be the famous trademark according to the popularity of No.1255550 trademark in China and the infringement act of Jiaxing Alisidun Company.
“Alisidun” identification used by Jiaxing Alisidun Company is similar to No. 1255550 trademark involved in the case. “ALSDON” identification is only slightly different from the phonetic alphabet of Chinese “Alisidun” and the English “Ariston” of the abovementioned trademarks in the middle location, but such difference is not obvious to the relevant public with the Chinese as the mother tongue; thus, it constitutes similarity and it is easy to make the relevant public misunderstood the commodity sources or think the commodity sources have the certain relation so as to result in confusion. Therefore, Jiaxing Alisidun Company can be confirmed to infringe the exclusive right to use No. 1255550 famous registered trademark involved in the case.
For the domain name of “alisidun.com” used by Jiaxing Alisidun Company, its main party “alisidun” is similar to the English of No. 1255550 and No. G684565 registered trademark and is also the phonetic expression of “Alisidun” of the former; meanwhile, Jiaxing Alisidun Company conduct the e-commerce activities such as publicity and promotion of the similar commodities through such domain name and it is easy for its acts to make the relevant public confused and also infringe the exclusive right to use No. 1255550 and No. G684565 registered trademark.
No. 1255550 registered mark involved in the case was a famous trademark in 2005. By taking “Alisidun” as the corporate word and taking the phonetic alphabet of such word ALISIDUN as the corporate English name when Jiaxing Alisidun Company was established, it has been deliberately intended to play up to No. 1255550 famous trademark; objectively, it has also been easy to make the relevant public think that it has had the relations such as cooperation and permission with Macchi Company and Ariston China Company so as to be confused with the commodity sources, damage the legal rights and interests of Macchi Company and Ariston China Company; thus, it constitutes the unfair competition.
Nanjing Intermediate People’s Court judges in the first instance as follows: Jiaxing Alisidun Company shall immediately stop the act of infringing the exclusive right of Macchi Company and Ariston China company to use No. 1255550 and No. G684565 registered trademark; it shall immediately stop using “Alisidun” word in the enterprise name, stop using “ALISIDUN” in its English enterprise name and handling the name change registration; it shall immediately stop using the domain name of “alisidun.com” and immediately stop the act of false publicity; it shall compensate Macchi Company and Ariston China Company for the economic losses of RMB 2,000,000 including the legal expenses to stop such infringement. Jiangsu Provincial Higher People's Court judges in the second instance as follows: reject the appeal and maintain the original judgment.
 
[Judge's Comment]
Objective existence of the famous trademark confirmation alienation phenomenon in the previous years has resulted in the excessive caution in the individual case confirmation of the famous trademark currently. The overcorrecting result is that the ob,ligees have to register a lot of defensive trademarks to prevent infringement but it has still not be able to effectively stop so many malicious registering actions and attachment acts existing. The value of this case lies in that a common basic truth in the trademark disputes has been confirmed by the judicial decision, that is, the obligee may have multiple registered trademarks in different categories with different popularity but what the defendant plays up to is the obligee’s most popular trademark obviously. According to the principles of passive confirmation and individual case confirmation, for the trademarks that have indeed reached the famous degree, the judicial protection power shall correspond to their brand reputation degree accumulated for a long time to reflect the current judgment guidance of strictly protecting the intellectual property.
Secondly, for the case in which the name of the enterprise charged infringes the exclusive right to use trademark or constitutes the unfair competition, whether to order to stop the infringement, it shall be determined according to the specific conditions of the case, and the discretion shall be made fairly and reasonably based on comprehensively considering the subjective malicious degree, historical factors and current use situation. In principle, the world co-existence shall take the defendant’s goodwill as the premise, and the malicious attachment act shall be stopped to reflect that the Trademark Law encourages the value orientation of honesty and credibility and integrity operation.
This case has the typical significance in exactly understanding the legal provisions on judicial protection of famous trademarks, exactly grasping the conditions for the judicial confirmation of the famous trademarks and strengthening the judicial strength for the famous trademarks.
 
CASE 18: THE DISPUTE ON THE TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION BETWEEN BAYERISCHE MOTOREN WERKE CO., LTD. AND SHANGHAI CHUANGJIA CLOTHING CO., LTD., DAMON GROUP (INTERNATIONAL) HOLDING CO., LTD., ZHOU YUEQIN
◆ First Instance Case No.: (2015) Hu Zhi Min Chu Zi No. 58
◆ Shanghai Municipal
◆ Case Type: Civil Case
 
[Keywords]
When there are multiple similar trademarks in the infringement identification charged and one of them has been registered before the obligee’s trademark becomes famous; at this moment, the trademark registered after the obligee’s trademark becomes famous shall be judged whether to belong to the copy and simulation of the famous trademark and whether to stop being used according to the factors including whether the infringer charged has the obvious subjective malicious infringement, whether the actual use of the infringement trademark identification registered later inherits the business reputation of the trademark identification registered before and whether the infringement identification charged registered later is so same with or similar to the obligee’s trademark to misunderstood the public and may resulting the damage of the obligee’s interest.
 
[Synopsis]
Plaintiff Bayerische Motoren Werke Co., Ltd. (BMW Company)
Defendant Shanghai Chuangjia Clothing Co., Ltd. (Chuangjia Company)
D e f e n d a n t D a m o n G r o u p (International) Holding Co., Ltd. (Demon Company)
Defendant Zhou Yueqin
BMW Company is the world-famous automobile manufacturer. As of 2013, BMW Company had sold more than 390,000 automobiles in China and its revenues had exceeded 15.3 billion Euros. BMW Company has registered the word and figurative marks including "Bayerische Motoren Werke" and "BMW" in the commodities such as automobile, clothing and luggage. In July 2008, Defendant Zhou used "Bayerische Motoren Werke" and "BMW" as the name and founded defendant Damon Company. Afterwards, Damon Company and Zhou obtained the trademarks such as "BMN" by transfer and registration; in addition, it authorized defendant Chuangjia Company the use mode to establish BMN brand franchise and mixed the infringement identification charged with the trademark of BMW Company involved in the case by the way of changing the registered trademark identification to the infringement identification and conducted the combined use. BMW Company appeals to the court with the reason of such three defendants’ acts having constituted the trademark infringement and unfair competition and requests the court the order such three defendants to stop infringement, compensate the damages and eliminate the effect.
In the first instance, Shanghai Intellectual Property Court holds that BMW Company’s series of trademarks of "Bayerische Motoren Werke" and "BMW" became the famous trademarks in 2007 and have continues till now. Chuangjia Company, Damon Company and Zhou have maliciously conspired, independently used or authorized others to use the infringement identifications charged in the condition that they clearly know that the trademarks of BMW Company involved in the case belong to the famous trademarks so it has constituted the trademark infringement and unfair competition. Shanghai Intellectual Property Court orders such three defendants to immediately stop the trademark infringement and unfair competition, publish the declaration in China Industry & Commence News and compensate BMW Company for the economic losses of RMB 3 million together. After the judgment, no party has instituted the appeal.
 
[Judge's Comment]
This case is an extremely novel and typical case of dispute on the trademark infringement and unfair competition. In this case, many legal issues have been involved, such as whether the registration and use of the trademarks obtained by the extended registration of the registered trademarks before the obligee's trademark becomes famous are stipulated by the famous trademarks, how to confirm joint infringement for relevant different acts implemented by different subject in the trademark infringement case, how to correctly distinguish the infringement acts and infringement identifications in the case of the famous trademark protection. The infringement act charged in this case also has the typical characteristics such as that the infringers charged try to cover their infringement act purpose by the way of transferring and registering the trademark and registration the enterprise name, expand the infringement effect and scope by establishing the franchise system, confuse the public by the comprehensive simulation of the oblige and implement three-dimensional infringement acts from registration to use together by work division.
 
CASE 19 : THE ADMINISTRATIVE DISPUTE ON 乔丹 SERIES OF TRADEMARK
◆ Case No.: (2016) Zui Gao Fa Xing Zai 15; (2016) Zui Gao Fa Xing Zai 20; (2016) Zui Gao Fa Xing Zai 25; (2016) Zui Gao Fa Xing Zai 26; (2016) Zui Gao Fa Xing Zai 27; (2016) Zui Gao Fa Xing Zai 28; (2016) Zui Gao Fa Xing Zai 29; (2016) Zui Gao Fa Xing Zai 30; (2016) Zui Gao Fa Xing Zai 31; (2016) Zui Gao Fa Xing Zai 32
◆ Beijing Municipal
◆ Case Type: Administrative Case
 
[Keywords]
Michael Jeffrey Jordan v. the State Administration for Industry & Commerce of People's Republic of China Trademark Review and Adjudication Board, and Qiaodan Sports Co., Ltd. trademark administrative dispute retrials [Supreme People’s Court (2016) Zui Gao Fa Xing Zai No.15, 20, 25, 26, 27, 28, 29, 30, 31, 32 administrative judgment]
 
[Synopsis]
Retrial applicant Michael Jeffrey Jordan is a famous American NBA basketball star. In 2012, he applied to the State Administration for Industry & Commerce of People's Republic of China Trademark Review and Adjudication Board (Trademark Review and Adjudication Board) for the withdrawal of Qiaodan Sports Co., Ltd. (Qiaodan) registered trademarks under the name of "乔丹" "QIAODAN". Trademark Review and Adjudication Board overruled the application in 2014. The retrial applicant rejected and then filed an administrative lawsuit. In 2015, the retrial applicant rejected the second instance verdict of 68 cases of administrative disputes in the Higher People's Court of Beijing Municipality, and applied to the Supreme People's Court (SPC) for the retrial. In December 2015, SPC brought ten cases to trial. Meanwhile, SPC overruled the retrial of another 50 cases and ruled the suspension of 8 cases. In accordance with the law, SPC formed a collegiate bench consisting of 5 people with vice president, grand justice TAO Kaiyuan as the presiding judge to hear 10 cases. After the discussion of the judicial committee of SPC, they ruled that: (1) For "Qiaodan" trademark (2016) SPC No. 15, 26, and 27, the registration of the disputed trademark "乔丹" infringed the prior right to name of the retrial applicant, which did not comply with Article 31 of Trademark Law revised in 2001: application for trademark registration shall not infringe prior rights of others. Thus, they decided to withdraw the defendant judgment made by the Trademark Review and Adjudication Board, as well as the first and second instance verdict, and ordered the Trademark Review and Adjudication Board to re-rule on trademark disputes. (2) For Pinyin “Qiaodan” trademark No. (2016) Zui Gao Fa Xing Zai 20, 29, 30, and 31, as well as the combination of pinyin "qiaodan" and pattern trademark No. (2016) Zui Gao Fa Xing Zai 25, 28, 32, 7 cases in total, due to retrial applicant is not entitled with the name right of "QIAODAN" nor "qiaodan", the registration of the disputed trademark does not infringe his prior right of name. The disputed trademark is not included in Article 10 (1) (h) of the Trademark Law: be harmful to the socialist morality or cause other adverse effects, nor in Article 41 (1): use deceptions or other improper means to get registered. Thus, the court affirmed the second instance verdict, dismissed the retrial application.
 
[Judge’s Comment] SPC held the trial and pronounced the judgment of the above case in public, which equally protects legitimate rights and interests of obligees home and abroad, and further establishes the image of the responsible power of the judicial protection of intellectual property in China. In the judgment, SPC emphasized the importance of the principle of sincerity and credibility for the standardization of trademark registration application. It is of great significance to purify the registration and use of the trademark, protect the legitimate rights and interests of consumers, promote and carry out the socialist core values. In the judgment, SPC stated the significant impact of legitimate standards for the protection of prior right of name in the Trademark Law on such cases.
 
CASE 20: THE TRADEMARK ADMINISTRATIVE DISPUTE ON LAFITE AND CHȂTEAU LAFITE ROTHSCHILD
◆ Case No.: (2016) Zui Gao Fa Xing Zai 34
◆ Beijing Municipal
◆ Case Type: Administrative Case
 
[Keywords]
Chateau Lafite Rothschild v. the State Administration for Industry & Commerce of People’s Republic of China Trademark Review and Adjudication Board, and Nanjing Gold Hope Wine Co., Ltd. trademark administrative dispute retrial [Supreme People’s Court (2016) Zui Gao Fa Xing Zai No. 34 administrative judgment]
 
[Synopsis]
The application date of No. 4578349 "拉菲庄园" trademark (the disputed trademark) is April 1, 2005. It got approved within the use of No. 33 wine, alcohol (beverages) and other commodities, under the registrant Nanjing Gold Hope Wine Co., Ltd. (Gold Hope). The application date of "LAFITE" (i.e., the reference trademark) is October 10, 1996. It got approved within the use of No. 33 alcoholic beverages (excluding beer), under the registrant Chateau Lafite Rothschild (Chateau Lafite). Chateau Lafite put forward a dispute application to the State Administration for Industry & Commerce of People’s Republic of China Trademark Review and Adjudication Board (Trademark Review and Adjudication Board). Trademark Review and Adjudication Board made Shang Ping Zi [2013] No. 55856 The Order on No. 4578349 "拉菲庄园" Trademark Dispute (Order No. 55856) that to revoke the registration of the disputed trademark. Gold Hope rejected and filed an administrative litigation. The First Intermediate People’s Court of Beijing held that through the relevant media reports, combining with the situation that “LAFITE” wine of Chateau Lafite entered the Chinese market earlier before the registration date of the disputed trademark, Chinese domestic public learnt about "LAFITE" and called it "拉斐", "拉菲 特" or "拉菲" (transliterations of “LAFITE”in Chinese) that enjoys a high reputation. The registration of the disputed trademark violates the provisions of Article 28 of 2001 Trademark Law, and the judgment affirmed Order No. 55856. Gold Hope rejected and filed an appeal. In the second instance, the Higher People’s Court of Beijing held that it was difficult to identify the market awareness and public recognition of the reference trademark in Chinese Mainland before the application of the disputed trademark. It has been 10 years since the registration and use of the disputed trademark, for the consideration of protecting the established and stable market, the disputed trademark should be sustained; thus, the first instance verdict and Order No. 55856 should be abrogated. Chateau Lafite rejected then filed an appeal to the Supreme People's Court (SPC) for retrial. SPC brought it up to trial and ruled on December 23, 2016 that repealing the second instance and affirming the first instance verdict and Order No. 55856.
 
[Judge's Comment]
This case involves the similarity estimation of Chinese and English trademarks, and the formation of a stable market order and other issues. SPC holds that the reference trademark in this case enjoys a high reputation. After years of business activities, Chateau Lafite has objectively established a strong connection with "拉菲" and "LAFITE"; thus, there is a similarity between the disputed trademark and reference trademark, which violates of the Article 28 in the Trademark Law. In addition, for a trademark that has been registered for a while, whether the trademark has established a higher market reputation and whether it has formed a targeted consumer group are not determined by the single factor of time but objectively determined by whether the use of trademark enables the public to distinguish it from the relevant trademark. There is no such confusion in this case. In retrial, constituent elements of marks, the similarity degree of the trademark, the identification and popularity of the relevant trademark, the identification of the stable relationship, and the related consumer group are discussed. Then on the basis of discussion, the standard of the similarity judgment between Chinese and English trademarks is clarified, which has a significant guidance to future cases.
 
CASE 21: THE ADMINISTRATIVE DISPUTE OF RETRIAL ON TRADEMARK APPLICATION REJECTION OF TRADEMARK REVIEW AND ADJUDICATION BOARD OF THE SAIC, APPEALED BY SHENZHEN DJI-INNOVATIONS
◆ Case No.: (2016) Jing 73 Xing Chu Zi No. 271
◆ Beijing Municipal
◆ Case Type: Administrative Case
 
[Keywords]
The main argument of this case lies in whether the trademark belongs to the direct descriptive mark which is restricted to be registered regulated by Article 11 (1) (b) of the Trademark Law. To determine whether a trademark is a direct descriptive mark, the following two aspects should be considered: firstly, the first recognition when relevant public sees the mark. That is, if relevant public sees a mark, without imagination, they can judge that it belongs to the description of features of certain goods or services, it is a direct descriptive mark. If relevant public needs to undergo a certain degree of deduction, interpretation, description or imagination to correspond the mark with the features of goods or services, the mark falls into the category of implied marks. Secondly, whether it is a usual way operators from the same industry describe the feature, that is, whether it is often used by operators from the same industry to describe the functions, applications and features of such goods or services.
The reasons why implied mark is considered to have significant features are, firstly, relevant public needs a certain degree of deduction, interpretation, description or imagination to finally realize that the implied mark describes the characteristics of goods or services to a certain extent. Secondly, implied mark is not the direct description way which is widely used by operators from the same industry to describe the features of goods or services, thus it will not unduly hinder the legitimate use of competitors from the same industry.
In this case, the trademark compares the camera equipped on "aerial or airborne launch vehicle" as "flying camera". A certain degree of deduction and imagination of relevant public are required to link the mark with aerial shooting function, application and other features of above-mentioned good, and people cannot immediately determine that it belongs to the description of above functions, applications and other features. In addition, no evidence in this case verifies that "FLYING CAMERA" is a usual way operators from the same industry used to describe the functions and applications of the above-mentioned commodity. Therefore, the mark doesn’t belong to category of direct descriptive mark and its registration application does not violate the provisions of Article 11 (1) (b) of Trademark Law.
 
[Synopsis]
The plaintiff sued to the court for adjudication on trademark rejection of "FLYING CAMERA" of Trademark Review and Adjudication Board. The plaintiff argued that the trademark "FLYING CAMERA" is significant. The defendant believes that "FLYING CAMERA" can be understood as "camera which can fly", which is used in designated product and directly describes the features of product functions, applications etc., in violation of the provisions of Article 11 (1) (b) of the Trademark Law. Therefore the decision to apply for trademark is rejected.
The court, with a comprehensive consideration of the legislative principle of Article 11 (1) (b) of the Trademark Law and the judgment criteria of direct descriptive mark confirmed that the trademark is not a direct descriptive mark and its registration application does not infringe the Article 11 (1) (b) of the Trademark Law.
The court of second instance maintained the judgment of first court and the case is now in force.
 
[Judge's Comment]
Trademark Law provides that, for direct descriptive mark, its trademark registration should be limited. But how to determine whether a trademark is a direct descriptive mark, or what’s the boundary of direct description mark and implied mark, are not clearly regulated in trademark law and judicial standards in practice are not unified. This case clearly identifies the criteria for the direct descriptive mark, that is, to make a decision from two aspects, the first recognition of the relevant public to see the mark and whether it is a common way used by competitors to describe the features. Meanwhile, it confirms that the boundary of direct description mark and implied mark lie in whether it requires a certain degree of deduction, interpretation, description or imagination to connect the mark with correspondent features of goods or services, and whether it is a direct descriptive way operators from the same industry commonly use to describe features of goods or services. This case provides a good reference for the handling of similar cases.
 
CASE 22: IMPOSING GREATER PRESSURE UPON IP INFRINGERS THROUGH MULTIPLE LEGAL ACTIONS
◆ First Instance Case No.: (2016) Yue 0111 Min Chu No. 671
◆ Second Instance Case No.: (2016) Yue 73 Min Zhong No. 958
◆ Case Type: Civil Case
◆ First Instance Case No.: (2014) Sui Yun Fa Zhi Xing Chu Zi No. 169
◆ Second Instance Case No.: (2015) Sui Zhong Fa Xing Er Zhong Zi No. 598
◆ Case Type: Criminal Case
◆ Guangdong Province
 
[Keywords]
After initiating a criminal action against an individual trademark counterfeiter, STIHL filed a follow-up civil lawsuit against the trademark counterfeiter and his company, on the ground of both trademark counterfeiting and trade dress infringement. By this civil lawsuit, STIHL solved the trade dress infringement problem and imposed greater pressure upon the counterfeiter.
 
[Synopsis]
In March 2014, ANDREAS STIHL AG & CO. KG (hereinafter "STIHL") requested the police of Baiyun District, Guangzhou City to raid a factory named “Guangzhou Rui Song Machinery Co., Ltd.” (hereinafter "RUI SONG"). The police seized a lot of fake STIHL chain saws as well as some sales records. The chain saws displayed the STIHL registered trademark logo and the characteristic orange and grey color combination, which was the “special trade dress of a reputed product” as provided by the Anti-unfair Competition Law. HUANG Zhurong (hereinafter "HUANG") was the sole shareholder of RUI SONG. The police arrested HUANG and, after further investigation, the public prosecutor brought the case to Baiyun District Court for the crime of trademark counterfeiting. The court found that HUANG’s production and sale of fake STIHL chain saws constituted the crime of counterfeiting registered trademark, sentenced HUANG to three years’ imprisonment, imposed a fine of RMB 650,000, and confiscated the seized counterfeit products for destruction. HUANG appealed on ground that not all the chain saws already sold bore the STIHL trademark logo, as the business records did not specifically mention so, and there was no supporting evidence to prove that all the chain saws sold by him bore the STIHL trademark. In September 2015, the Guangzhou Intermediate People’s Court lowered the criminal fine to RMB 100,000.
After the criminal prosecution, STIHL filed a civil lawsuit with the Baiyun District Court against both HUANG and his company RUI SONG, on the ground of trademark counterfeiting and trade dress infringement. STIHL requested the court to affirm that the criminal fine (RMB 100,000) which was part of the criminal sentence, should be used in priority to pay for the damages awarded in the civil case, should the defendant's assets prove to be insufficient. The Baiyun District Court ruled in favor of STIHL on both accounts (trademark counterfeiting and trade dress infringement) and ordered the defendants to jointly pay RMB300,000 as damages, specifying that part of the criminal fine already paid by the defendants was to be affected to the payment of the civil damages. The defendants appealed. In November 2016, Guangzhou Intellectual Property Court maintained the decision of Baiyun District Court.
 
[Judge's Comment]
This "follow-up civil lawsuit" provides guidance for similar cases in the following aspects:
1. The IP owner may have the court affirm that the damages to be paid to the plaintiff shall prevail over the criminal fine so as to facilitate enforcement of civil judgment.
In filing the lawsuit, STIHL requested the court to affirm that in case the property of the defendants was not enough to pay the civil compensation, the court should use the criminal fine already paid by the defendant to enforce the civil judgment. The court agreed.
This is expressly provided for in Article 4 of the Torts Law: "Where a tortfeasor bears administrative liability or criminal liability, it shall not prejudice the civil liability that the tortfeasor shall bear for the same conduct. Where the assets of a tortfeasor are not sufficient to cover the civil liability, administrative liability or criminal liability for the same conduct, the tortfeasor shall firstly bear the civil liability.”
In China, the court normally will not permit the trademark owner to file a civil claim in the context of a criminal prosecution because only the victim suffering from loss of tangible property is entitled to file such a claim. But the trademark owner may file an independent civil lawsuit. In this civil lawsuit, it is advisable that the plaintiff specifically request the court to confirm the plaintiff's entitlement to the criminal fine in case the defendant’s property is not sufficient to pay the damages, so that in the future enforcement procedure the judge may directly allot the criminal fine paid by the defendant for recovery of the damages.
2. The IP owner may use the relevant evidence obtained by the police and the facts affirmed by the court in the criminal action to solve infringement other than trademark counterfeiting (patent, trade dress).
In the subject case, according to the police investigation, HUANG's sales record of chain saws amounted to RMB 1.27 million. However, the Guangzhou Intermediate Court could not ascertain if all the chain saws sold by HUANG bore the STIHL trademark logo because many business records did not specifically mention the STIHL trademark. The court only found the value of the counterfeit STIHL chain saws and chain saw parts seized by the police as amounting to more than RMB 100,000, and the counterfeit STIHL chain saws sold by HUANG to be worth RMB 180,000. In the criminal judgment, apart from the criminal sentence, the Court only ordered HUANG to stop the trademark counterfeiting business.
Yet, according to the evidence collected by STIHL itself such as notarization of the counterfeiter’s website, it was clear that all the chain saws produced and sold by HUANG bore the orange and grey colors. In the follow-up civil lawsuit, STIHL provided such evidence. STIHL proved that, through extensive use and advertisement, the relevant public was making a stable association between this color combination and STIHL's chain saws. The court supported STIHL's claim of unfair competition and calculated the damages based on the defendants’ production and sale of all chain saws.
3. The IP owner may have the infringers bear joint liabilities by proving their "mixture of legal personalities".
In this case, the defendant HUANG argued that it was the company RUI SONG that should bear the liability for compensation because it was the company that was engaged in the illegal business. STIHL proved that, according to HUANG’s bank account records obtained by the police, HUANG received the money directly for RUI SONG’s sale of the fake chain saws, and paid the rent of RUI SONG from his personal bank account every month. HUANG's behavior was mixed with that of RUI SONG. Article 63 of the Company Law stipulates that, "if the shareholder of a single-person limited liability company is unable to prove that the property of the single-person limited liability company is independent from his own property, he shall bear joint liabilities for the debts of the company." Thus, the court ordered HUANG and RUI SONG to bear the joint liability, which means the court may seize both the personal property of HUANG and any property under the name of RUI SONG in enforcing the judgment on damages.
 
CASE 23: CASE ON COUNTERFEITING REGISTERED TRADEMARK BY YANG SHUNWU
◆ First Instance Case No.: (2015) Fo Nan Fa Zhi Xing Chu Zi No. 30
◆ Second Instance Case No.: (2016) Yue 06 Xing Zhong No. 400
◆ Guangdong Province
◆ Case Type: Criminal Case
 
[Keywords]
In the crimes of counterfeiting registered trademarks, the value of the infringement products discovered and seized will directly influence confirmation on the defendants’ illegal business amount. Meanwhile, whether the infringement products discovered and seized are the complete products and whether their value should be included in the illegal business amount shall meet the conditions as follows: 1. The infringement products have been completed and have had the use functions of such articles; 2. the relevant obligees verify that they produce the same commodities and can be sold independently; 3. price evaluation on the infringement products can be conducted and the evaluation conclusion has been issued.
 
[Synopsis]
Between November and December 2014, Yang Shunwu employed the workers to take advantage original Chunxing Clothing Weaving Factory located in Xiqiao Industrial Park, Shatou, Jiujiang Town, Nanhai District, Foshan City to produce the intelligent bed with fake "MPE" registered trademark without being authorized or permitted by the registered trademark "MPE" obligee. On December 15 of the same year, the policemen arrested Yang Shunwu in the abovementioned factory and seized a batch of beds, mattresses and bed products with fake "MPE" registered trademark on the spot. The abovementioned beds were marked with the type and price but were not installed with the motor and remote control unit. Yang Shunwu claimed that the beds discovered and seized were not installed with the motor and remote control unit so they were not the complete intelligent bed products, could not be circulated and sold in the market and their value should not be included in the illegal business amount. The first instance judgment held that Yang Shunwu had made the crime of counterfeiting the registered trademark so he was sentenced to three years in prison and fined RMB one hundred thousand. Yang Shunwu instituted the appeal with the reasons that the beds involved in the case were not the finished products, that the evaluation conclusion was not creditable and this case was the unit crime. After the trial, the second instance court held that the intelligent beds with the fake “MPE” registered trademark discovered and seized by the public security organization had not had the motor and remote control unit but they were the complete products instead of the semi-finished products as bed and belonged to the commodity verified to be used of this registered trademark. The delivery note issued by the victim unit also verified that it had sole the intelligent beds without motor and remote control unit. Yang Shunwu held that the intelligent beds without the moter and remote control unit were the semi-finished products but did not provide any evidence to prove it, and it did not provide the disproof in terms of the victim unit selling the intelligent beds without motor and remote control unit. Therefore, as the price evaluation agency with the statutory qualification, Foshan City Nanhai District Price Authentication Center conducted the price evaluation on the products discovered and seized, such as the intelligent beds without motor and remote control unit involved in the case according to the legal procedure, and proved by the evidence such a the registered trademark license of the infringement trademark, it could be deemed as the basis of the illegal business amount of Yang Shunwu’s crime of counterfeiting the registered trademark. It was proper for the original instance judgment confirmed the illegal business amount of Yang Shunwu’s crime of counterfeiting the registered trademark based on it. The final judgment in the second instance rejected the appeal and maintained the original judgment.
 
[Judge's Comment]
Nowadays when the science and technology change rapidly, the newtype high-tech commodities emerge endlessly, and such commodities are slightly different with the traditional commodities; for example, the difference of the intelligent beds in this case only lies in the motor and remote control unit. How to confirm whether such commodities are complete and whether they can be circulated normally has become the key point of the case trial. In this case, the full and detailed discussions on the definition of finished and semi-finished products were conduced clearly and logically in the well-arranged way.
 
CASE 24: CASE ON DEFENDANT HOUS CRIME OF SELLING THE COMMODITIES WITH THE FAKE REGISTERED TRADEMARK
◆ Case No.: (2016) Hu 0115 Xing Chu No. 366
◆ Shanghai Municipal
◆ Case Type: Criminal Case
 
[Keywords]
The defendant was "indeed ready to be surrendered" but he failed to confess the main criminal truth after he was present so he did not conform to the confirmation condition for voluntarily surrendering himself.
 
[Synopsis]
Between April 2014 and May of the next year, defendant Hou still purchased a lot of white spirit from the person not involved in the case and then raise the price and sold it in the condition of clearly knowing it was the white spirit of the fake brands such as "Wuliangye". Between February and May 2015, defendants Li and Gu still purchased the white spirit from Hou with more than RMB 90,000 and then raised the price and sold it after the collusion in advance in the condition of clearly knowing it was the white spirit of the fake brands such as "Wuliangye". In addition, Hou also sold the fake "Wuliangye" and other brands to others for RMB 122,820 in total. On May 11 and 12, 2015, the public security organization discovered and seized 1,352 bottles of the fake "Wuliangye" and others worth RMB 281,192 in total in his office space successively. On May 15, 2015, Hou was arrested by the public security organization, and he did not confess the abovementioned criminal truth initially when he was presented but made the truthful confession later. Within the days from the crime to arrest, Hou implemented the acts such as transferring to his business partner Jin and transferring the funds in the security account to his ex-wife (his ex-wife said that they were the education expenses for their son). According to Jin’s witness, he contacted Hou on the very day when the crime was discovered; Hou expressed "I will surrender myself after I treat all the matters in hand". According to the witness of the neighbor of Hou's ex-wife and Jin’s elder sister, Hou expressed that he would surrendered himself before he was arrested, and asked them to help to contact the attorney to accompany him to surrender himself and take the key to the car back. On June 1 of the same year, Li and Gu actively surrender themselves after the policeman notified them by telephone and confessed the criminal truth strictly according to the facts. After trial, Pudong New District Court held that such three defendants’ acts had constituted the crime of selling the commodities with the fake registered trademarks. On whether Hou constituted the voluntary surrendering, from the subjective perspective, Hou clearly expressed that he would surrender himself to multiple persons after crime was discovered, and from the objective perspective, he made the financial arrangement of the company operation and his son's education issue and he did not resist the arrest when he was arrested, he could be confirmed to be indeed ready to surrender himself before he was arrested. The truthful confession in the voluntary surrendering is closely related to the active surrendering and the time shall be the first confession in terms of the main criminal truth after the defendant is presented. However, Hou did not confess the main criminal truth that he clearly knew the commodities were the commodities with the fake registered trademarks and the content in the former and later confession were quietly different; in addition, he even made up the corresponding truth to try to escape from the criminal responsibility and caused the certain obstruction to the investigations of the public security organization; thus, his acts did not conform to the legal provisions of the confirmation of voluntary surrendering. However, in view that Hou confessed the main criminal truth strictly according to the facts in the later period of investigation, which conformed to the honest confession condition, so his punishment could be lesser. Therefore, Hou was sentenced to imprisonment for two years and ten months and the fine of RMB 300,000; Li was sentenced to detention for six months, probation for six month and the fine of RMB 20,000; Gu was sentenced to detention for six months, probation for six months and the fine of RMB 20,000; such three defendants’ illegal incomes will be recovered, and the commodities with the fake registered trademarks discovered and seized will be confiscated. After the judgment, no defendant instituted the appeal and the judgment has taken effect.
 
[Judge's comment]
This case is a trademark criminal case of selling the fake famous wine. Sales of the fake wine not only infringe the trademark obligee's legal interests but also may cause damage to the consumers’ health when severe. In this case, the sentencing involves confirmation of the "indeed ready to be surrender" voluntary surrendering. According to the principle and subjective and objective consistence and combined with the defendant Hou's expression of being readying to surrender himself and his acts before and when he was arrested, it is confirmed that he "was indeed ready to be surrendered" but he did not timely confess the main criminal truth strictly according to the facts after he was present so he did not conform to the confirmation condition of the voluntary surrendering. In the criminal judicial policy background of "combining punishment with leniency", this case correctly understands and applies the voluntary surrendering system, does not accept the defense opinion on the defendant Hou's voluntary surrendering and sentences the substantial punishment to them so as to reflect the people's court protects the intellectual property strictly.
 
CASE 25: CASE ON DEFENDANT LIANG SHUNXI, ORIGINAL INSTANCE DEFENDANT LIU GUIQUAN AND THE ORIGINAL INSTANCE DEFENDANT HUANG YONGTAOS CRIME OF COUNTERFEITING REGISTERED TRADEMARK
◆ First Instance Case No.: (2016) Yue 0306 Xing Chu No. 1826
◆ Second Instance Case No.: (2016) Yue 03 Xing Zhong No. 2012
◆ Guangdong Province
◆ Case Type: Criminal Case
 
[Keywords]
The full-time anti-counterfeiting person actively released the information of buying the commodities with the fake registered trademarks on the Internet to obtain the anti-counterfeiting bonus from the trademark oblige and contacted the other two defendants and negotiated the specific criminal process, assigned the person to conduct supervision and acceptance by QQ and telephone, and he actively reported the case after completing the labeling criminal act. The full-time anticounterfeiting person incited, induced and instigated others to manufacture counterfeits without obtaining the production authorization and he played the main role in the joint offense so he should be confirmed as the principal criminal. He had the personal purpose to call the police actively but his act had the active justice nature essentially and he could confessed his crime basically according to the facts; thus, he is confirmed to surrender himself and his punishment shall be reduced.
 
[Synopsis]
Original public prosecution organ: Shenzhen Baoan District People's Procuratorate.
Appealer (original defendant): Liang Shunxi.
Original defendant: Liu Guiquan.
Original defendant: Huang Yongtao
"" is the registered trademark of Huawei Technology Co., Ltd., and "" is the registered trademark of Cisco Technology Company.
Around June 2015, defendant Liu Guiquan acquainted himself with defendant Liang Shunxi to get the anticounterfeiting bonus from the trademark obligee; they contacted by QQ and telephone and agreed that Huang Yongbo recommended by Liang Shunxi would provide the trademarks and Liang Shunxi would provide the fiber modules and they would sold the products to Liu Guiquan after labeling them in the unit price of RMB 62.
At the beginning of August 2015, defendant Liu Guiquan placed the order to Liang Shunxi to customize Huawei fiber modules and Cisco fiber modules without obtaining the production authorization from the registered trademark obligees involved in the case. Later, Liang Shunxi paid the money of RMB 10,000 through transfer of accounts. A few days later, Liang Shunxi, Huang Yongtao and Hung Yongbo sent the fake Huawei and Cisco fiber modules of which labeling was completed to the location designated by Liu Guiquan and then Liu Guiquan called the police; then, the public security organization arrested Liu Guiquan, Liang Shunxi and Huang Yongtao and discovered and seized the fiber modules with the fake Huawei and Cisco registered trademarks on the spot, and the value was evaluated to be RMB 3,928,500.
The original court held that defendants Liu Guiquan, Liang Shunxi and Huang Yongtao used the trademarks same with the registered trademark owners' two registered trademarks in the same kind of commodities without their permissions and that the circumstances were especially serious and their acts had constituted the crime of counterfeiting the fake registered trademark. Defendant Liu Guiquan incited, induced and instigated other to manufacture the counterfeits without obtaining the production authorization and played the main role in the joint offense so he was confirmed to be the principal criminal; additionally, he was confirmed to surrender himself and his punishment was reduced according to law. Defendant Liang Shunxi organizaed the production and played the main role in the joint offence so he was confirmed to be the principal criminal. Defendant Huang Yongtao was confirmed to be the accessory criminal and his punishment was reduced.
Original judgment: I. defendant Liu Guiquan has made the crime of counterfeiting the registered trademark so he shall be sentenced to imprisonment for one year and six months and shall be fined RMB 50,000. Defendant Liang Shunxi has made the crime of counterfeiting the registered trademark so he shall be sentenced to imprisonment for three years and shall be fined RMB 110,000. Defendant Huang Yongtao has made the crime of counterfeiting the registered trademark so he shall be sentenced to imprisonment for one year and shall be fined RMB 10,000. II. All the infringement products seized shall be confiscated and destroyed.
Defendant Liang Shunxi refused to obey and instituted the appeal, believing that he should be confirmed as the accessory criminal and the sentencing in the original instance was too heavy and he requested the second instance to change the original judgment. After trial, the second instance court held that the original judgment confirmation had the clear facts, reliable and full evidence, legal trial procedures, correct applicable laws and proper sentencing so it should be maintained.
 
[Judge's Comment]
For how the full-time anti-counterfeiting persons correctly distinguish the boundary between the crime and right protection in the process of anticounterfeiting and safeguarding legal rights, the method to obtain evidence in the intellectual property civil cases cannot be assumed as a matter of course to be used in the criminal cases. The act of obtaining evidence itself can only change the time and location of the legal acts instead of improving the quantity and level of the legal acts; obtaining evidence is to stop the infringement acts instead of inciting or inducing the crime; any anti-counterfeiting or obtaining evidence act can be tolerated and accepted by the public and society only when it conforms to the justice of law.
It is stipulated in Article 29 of the Criminal Law of the People’s Republic of China: "Those inciting others to make the crime shall be punished according to their role in the joint offense. Those inciting the persons under the age of 18 to make the crime shall be given the heavier punishment." In this case, defendant Liang Shunxi and defendant Huang Yongtao might made the crime and might not made the crime originally and defendant incited, induced and instigated them to manufacture counterfeits in the condition of clearly knowing they did not have the trademark obligees' authorization and then the whole criminal fact was caused; defendant Liu Guiquan’s act was not just and also violated the stipulations in China’s Criminal Law. Therefore, the court confirms that defendant Liu Guiquan has constituted the crime of counterfeiting the registered trademark and give the punishment according to law.

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