Metso v. Sanland "Metso" Trademark Infringement Maximum Compensation Case

China IP,[Trademark]

 

First-instance case number: (2017) Shanghai 0115 Preliminary Civil Judgement 83471
Second instance case number:(2019) Shanghai 73 Final Civil Judgement No. 104
 
Although it is difficult to determine the specific amount of damage suffered by the right holder or the illegal gains of the infringer for intellectual property rights infringement, the content of the infringer’s publicity is sufficient to prove the infringer’s profit. If the infringer cannot prove the authenticity of its promotional content, then the rights holders' claims should be supported.
 
Case introduction
Appellants (defendants in the original trial): Shenyang Sanland Mining Equipment Manufacture Co., Ltd. (referred to as Sanland Mining Equipment), Shenyang Sanland Crushing and Grinding Equipment Manufacture Co., Ltd. (referred to as Sanland Crushing and Grinding Equipment)
 
Appellees (plaintiffs in the original trial): Metso Corporation, Metso Minerals Tianjin International Trade Co., Ltd. (referred to as Metso Minerals), Metso Minerals Tianjin International Trade Co., Ltd. Shanghai Branch (Referred to as Metso Shanghai), Metso Minerals Tianjin International Trade Co., Ltd. Beijing Branch (referred to as Metso Beijing)
 
Metso is the right holder of the "" "" "" trademarks, which are approved for use in products and services such as mineral processing equipment. Metso has licensed the above-mentioned trademark rights in mainland China to Metso Minerals and its branches.
 
The business scope of Sanland Mining Equipment and Sanland Crushing and Grinding Equipment is the production of various mining, crushing and grinding equipment and other mechanical products and parts. They faked cooperation or authorized production relationship with Metso Corporation on websites, WeChat Public Account and related exhibitions, or they hold Metso’s technology and drawings. And they claim that they can produce Metso Corporation’s original products, using the same serial number as some of Metso’s products. Sanland Mining Equipment and Sanland Crushing and Grinding Equipment used the "metso" logo in their exhibited posters and their WeChat public accounts, and used the "Meso" and "Metso" logos in the text descriptions of their crushers and other products without authorization. The “Metso” logo is also prominently used in the form of a watermark on the promotional pictures of the crusher products published on WeChat official accounts. Accordingly, Metso Corporation, Metso Minerals, Metso Shanghai, and Metso Beijing sued Sanland Mining Equipment and Sanland Crushing and Grinding Equipment to the People's Court of Shanghai Pudong New Area.
 
The court held in the first instance that the plaintiff and the defendant were competitors in the same industry. The plaintiff's enterprise and Metso's products have a high reputation among mining machinery enterprises. The series of acts of the defendant such as "claiming that there is a licensing relationship with the plaintiff; claiming that the use of Metso’s technology, holding Metso’s drawings; can produce original Metso products; saying its products are Metso products; copying Plaintiff's unique naming and numbering system” in their relevant websites, WeChat official accounts and the exhibition, will make the relevant public think that it is the plaintiff’s licensor, or the manufacturer entitled to produce and operate the plaintiff’s products, or the products it produces are the plaintiff’s products, or the defendant has an associated relationship with the plaintiff. Those acts not only deceived and misled the relevant public, but also improperly attached itself to the plaintiff’s corporate reputation and product reputation, took away the plaintiff and its affiliates’ business opportunities, and constituted an act of unfair competition for false promotion. Regarding the plaintiff's claim of trademark infringement, the defendant in the WeChat official accounts released the crusher products on the promotional pictures to highlight the use of "Metso" logo by way of watermark, and used "Metso" logo” in the text description of the crusher and other products without authorization. These belong to the act of using the plaintiff's similar trademarks on similar goods and constitute an infringement of the plaintiff's exclusive right to use the registered trademark.
 
The defendant’s act of using the " " trademark as one of the three trademarks under the "SANLAND" brand in the form of a chart was only to express to the relevant public the relationship between it and the plaintiff, and it belonged to the adjustment of false promotion, not trademark use.
 
In summary, the court decided in the first instance: the defendant immediately stop false promotion; immediately stop the "Metso" trademark infringement; compensate the plaintiff for economic losses of RMB three million and reasonable expenses RMB 100,000, and publish a statement to eliminate the impact.
 
Sanland Mining Equipment and Sanland Crushing and Grinding Equipment refused to accept the judgment of the first instance and appealed to the Shanghai Intellectual Property Court. The court ruled in the second instance: dismissed the appeal and upheld the original judgment.
 
Typical meaning
This case involves the application of the rule of selfincrimination outside litigation in the compensation of damages for intellectual property infringement. The defendant claimed in its WeChat Official Account that the transaction volume and transaction value related to the infringing products were very large, and it mentioned more than eighty times that it had sold the infringing products to relevant countries and regions, involving numerous foreign customers in more than a dozen countries and regions, including the United States, Russia, and Japan. The defendant also claimed to have provided services to dozens of large mines and quarries around the world. Although the defendant stated that the above content was for corporate publicity needs and was not true, he failed to provide evidence to deny its authenticity. Considering the plaintiff's product popularity and high price, the defendant business scale, obvious infringement subjective malice, long time infringement, a wide range of infringement, adverse effects caused by the scope and consequences of the greater damage, the court accordingly adopted the plaintiff's claim and sustained the full amount of damages claimed.

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