By Jiao Hongbin  King & Wood Mallesons’ Intellectual Property group.

On April 19, 2018, the Supreme People’s Court of the P.R.C released top 10 IP typical cases as well as additional 50 typical IP cases of the year 2017. We have summarized 19 out of the 22 trademark cases among them which involves the recognition of generic name, the protection of unregistered trademark, fair use of a trademark etc., for your easy reference.

Part I. Civil Cases

  1. Fuzhou Rice Factory vs. Wuchang Jinfutai Agricultural LLC., Fujian Xinhuadu Department Store Co., Ltd Fuzhou Jinshan Dajingcheng Branch., and Fujian Xinhuadu Department Store Co., Ltd (Supreme People’s Court/(2016) Zui Gao Fa Min Zai No. 374)

This case involves the relationship between a registered trademark and variety denomination as well as the criteria for recognizing generic name.

The Supreme People’s Court (“SPC”) opines that the name of a species, i.e., a variety denomination adopted by an administrative organization as pursuant to the administrative regulation shall not necessarily be regarded as the generic name from the perspective of trademark law. Generic name, as a matter of fact, should be recognized when such name is adopted by a national standard or an industry association.

  1. Commercial Press vs. Sinolingua Press (Beijing Intellectual Property Court/(2016) Jing 73 Min Chu No. 277)

This is a Court’s decision granting the protection of an unregistered well-known trademark.

The Court finds that for a product name such as “Xinhua Dictionary”, which has a mixed nature of both a product and a brand, public recognition, duration of use, sales records, promotion scope, as well as records of protection should be taken into consideration when determining whether the product name has obtained certain distinctiveness as required by a trademark. In this case, the Court believes that “Xinhua Dictionary” should be recognized as an unregistered well-known trademark in accordance with the above criteria and be protected accordingly. Meanwhile, the Court also points out that the exclusive rights for the use of a trademark as protected by the trademark law shall be limited to the trademark itself rather than the goods attached to it (dictionaries as in this case). In this regard, the exclusive rights for the use of “Xinhua Dictionary” enjoyed by the Plaintiff cannot prevent others from publishing similar dictionaries.

  1. Chateau LaFite Rothschild vs. Shanghai Baochun Industrial Development Co., Ltd. and Bao Zheng (Shanghai) Supply Chain Management LLC. (Shanghai Intellectual Property Court /(2015) Hu Zhi Min Chu Zi No. 518)

This is also a trademark infringement case involving unregistered well-known trademark.

The defendant began to sell the wine with the mark “MORONLAFITTE”, which is similar to the plaintiff’s mark “LAFITE” before the mark was approved for registration. Considering the abundant evidence provided by the plaintiff including sales records, media coverage, advertisements, prior recognition of the mark’s fame by other administrative authorities as well as the statement issued by relevant association, Shanghai Intellectual Property Court recognizes the mark “LAFITE” to be unregistered well-known trademark and therefore the defendant’s use of the alleged infringing mark prior to the registration date of the Plaintiff’s mark constituted trademark infringement.

  1. Jaguar Land Rover Limited Guangzhou Fenli Food Co., Ltd and Wan Mingzheng (Guangdong High People’s Court/(2017)Yue Min Zhong No. 633)

This is a typical case of cross-class protection of a well-known trademark and is also exemplary for its higher protection of intellectual property rights.

Both the first and second instance Courts find that “Land Rover” and “路虎”(Lu Hu) are well-known enough for cross-class protection on dissimilar goods/services (vitamin beverages as in this case). The uniqueness of this case is that the Courts specifically stressed the bad faith of the Defendant as it applied for registration of a large number of trademarks imitating other famous brands. In fact, the 1.2 million RMB damages were granted to the Plaintiff largely due to the Defendant’s bad faith.

  1. Beijing Huiyuan Food & Beverage Co., Ltd. vs. Heze Huiyuan Canned Food Co., Ltd. (SPC/(2015) Min San Zhong No. 7)

This is a typical case of trademark infringement and it also involves the dispute between a registered trademark and a trade name.

The court acknowledges the similarity between canned fruit in Class 29 and fruit beverage in Class 32 and thus rules for the establishment of trademark infringement as the marks at issue are almost identical. As for trade name, the court illustrates that the Defendant was aware of the Plaintiff’s registered trademark at the time it registered the company name and therefore, it can be concluded that the Defendant was in obvious bad faith to take free-ride off the Plaintiff’s goodwill. Thus, the Defendant shall also be held liable for unfair competition for using its company name.

  1. Shanxi Medicinal Materials Ltd. vs. Taiyuan Da Ning Tang Pharmaceutical Co., Ltd. (SPC/(2015) Min Ti No. 46)

This case also involves the dispute between a registered trademark and a trade name. However, contrary to case No. 5 above, it illustrates that a registered trademark and a trade name can be co-existent if both parties are in good faith.

The Plaintiff Shanxi Medicinal Materials registered the mark “大宁堂”  (Da Ning Tang) in 2010. The Defendant was registered in 1999 but the company name was changed to the current one in 2005, which used “大宁堂” (Da Ning Tang) as trade name. Furthermore, it is noted that the Defendant was established after the bankruptcy of a factory, which was once managed by the Plaintiff. This factory, before bankruptcy, operated a medicine store called “大宁堂” (Da Ning Tang). The Plaintiff brought a civil action accusing the Defendant of trademark infringement and unfair competition. SPC holds that, considering the unique historical background and market status, etc., it would be fair and impartial to allow both parties to use the trademark and trade name in the market.

  1. Cao Xiaodong vs. Yunnan Xiaguan Tuocha (Group) Co., Ltd. (SPC/(2017) Min Ti No. 273)

The key issue involved in this case is reverse confusion.

SPC holds that the rights of a trademark registrant not only lie in its ability to prohibit others from using a same/similar mark on the same/similar goods, but also the ability to use the mark so as to establish fixed connection between mark and its source of origin. With respect to customer confusion, there are two scenarios. One is the infringer’s goods being recognized as the trademark owner’s goods or has connection with the owner; the other one is the trademark owner’s goods being recognized as the accused infringer’s goods. In the second scenario, the legitimate rights of the trademark registrant to use its registered mark would be jeopardized and the role of indicating source of origin played by the registered mark will also be substantially impeded.

  1. Guiyang Nanming Laoganma Food Co. Ltd. vs. Guizhou Yonghong Food Ltd. & Beijing Oushang Supermarket Ltd. (Beijing High People’s Court/(2017) Jing Min Zhong No. 28)

This case is about the non-infringement defense of fair use.

The Plaintiff Guiyang Nanming Laoganma registered the mark “老干妈”  (Lao Gan Ma) on chili paste, which was recognized as a well-known trademark in several cases. The Defendant launched a series of beef jerky, including a flavor called  “老干妈”  (Lao Gan Ma) whose ingredient includes mixed “老干妈” (Lao Gan Ma) chili paste.

Both the first and second instance Courts find the defendant’s argument of fair use does not hold water for the following reasons: a) “老干妈” (Lao Gan Ma) was marked as the flavor of the beef jerky and was printed on the package, which shall be recognized as commercial use of a trademark; b) although the beef jerky was indeed made with mixed “老干妈” (Lao Gan Ma) chili paste, “老干妈” (Lao Gan Ma) is not one of the commonly used seasonings on jerky, nor in the industry. As a result, such use is not fair use of the Plaintiff’s mark; c) since “老干妈” (Lao Gan Ma) is a well-known trademark, the Defendant’s use of the mark would jeopardize the established connection between the well-known mark and the Plaintiff, and would subsequently dilute the distinctiveness of the well-known mark.

  1. Tian Renyue vs. Zhangjiajie Yongding District Pang Sao Da Gu Pi Restaurant and Hu Jinying (Hunan Zhangjiajie Intermediate People’s Court /(2017) Xiang 08 Min Chu No. 18)

This case is a positive example of the non-infringement defense of fair use.

“打鼓皮” (Da Gu Pi) has been the name of a local specialty in Zhangjiajie and many restaurants are named “打鼓皮” (Da Gu Pi) or provide dishes called “打鼓皮” (Da Gu Pi). Against this background, the Court finds the Plaintiff fails to prove that the high fame of “打鼓皮” (Da Gu Pi) was because of its use or advertisements and therefore cannot forbid others from using the mark in a fair way. Given the low distinctiveness of the mark, the protection scope of the mark shall also be limited accordingly. The defendant’s use of the mark “打鼓皮” (Da Gu Pi) shall constitute fair use for it only intends to indicate the dish it provides rather than the source of origin, as the Defendant also uses its own mark “Pang Sao” in a distinctive way.

  1. Suofeiya Home LLC. vs. Lv Xiaolin, Yin Fengrong and Nanyang Suofeiya Integrated Ceiling Co., Ltd. (Zhejiang High People’s Court/ (2016) Zhe Min Zhong No. 794)

This case confirms the rights of a trademark owner to freely choose the right basis it deems proper to initiate a trademark infringement dispute.

The rights owner registered its house mark “索菲亚” (Suo Fei Ya) on goods in different classes for defensive purpose while the mark is actually famous for furniture in Class 20. The Defendants use the same mark on integrated ceiling in Class 6 where the rights owner happens to have trademark registration for the mark too. However, the rights owner chooses to use the mark in Class 20 rather than the mark in Class 6 as rights basis to initiate the lawsuit. Zhejiang High People’s Court reasons that a trademark owner has the right to choose the most favorable mark to be its rights basis in accordance with its own trademark registration status and litigation strategy. If a Court does not allow the rights owner to seek the most favorable remedies by asserting well-known trademark for cross-class protection just to avoid the recognition of well-known trademark, it will result in insufficient protection for the rights owner’s rights and interests, which is also contrary to the goal and intention of the well-known trademark recognition system.

  1. Liu Yue vs. Hefei Anzhisuan Cosmetic Co., Ltd, Hefei Anzhisuan Nutrition Hair Co., Ltd, Beijing Yuqi Ritong Cosmetic Co., Ltd, and Beijing Wei & Dianna Cosmetic Co., Ltd (Anhui High People’s Court/(2017) Wan Min Zhong No. 525)

This case is about whether a licensor of an exclusive trademark license, namely the trademark owner who has licensed a third party to solely and exclusively use the mark, could ask for damages.

Anhui High People’s Court reasons that the premise for damages is the existence of damage. Under the condition that the mark has been exclusively licensed to a third party, a trademark owner has the rights to ask an alleged infringer to stop the infringing activities. However, as the trademark owner has already gained its profits from the mark by taking royalties, it does not enjoy any other economic interests with regards to the mark and therefore does not have the right to ask for damages from the alleged infringer.

  1. Shandong Foreign Trade Tai Feng Co., Ltd. vs. Shanghai Aixinlu Trade Co., Ltd, Qingdao Zhengyitang Trade Co., Ltd and third party Mykal (Qingdao) Department Store Co., Ltd (Shandong High People’s Court/(2016) Lu Min Zhong No. 493)

This is a new type of trademark infringement case involving the restriction of trademark rights.

In a situation where a trademark was opposed after it was published for trademark gazette, and after examination, the opposition was dismissed and the mark was registered, trademark rights shall be limited during the period between the deadline of the trademark gazette and the date the mark was actually approved for registration. That is, the trademark owner cannot assert its trademark rights and ask for damages for others’ use of the mark during such period unless such third party is in bad faith. When considering whether a third party is in bad faith, the following facts may be taken into consideration, a) whether the third party filed the trademark opposition on purpose so as to conduct trademark infringing activities during the opposition period; b) whether the third party is affiliated with the party who filed the trademark opposition and it was fully aware of the trademark opposition. In this case, the defendant is a distributor of the alleged infringing products and it has asked for proof of trademark rights from the manufacturer when signing the engagement agreement but the manufacturer failed to provide so. Furthermore, it was the manufacturer of the alleged infringing products that filed the trademark opposition and therefore, the defendant is presumed to be in bad faith and be liable for trademark infringement.

  1. Jiayou Shopping Group LLC., vs. Guizhou Jiayou Online Internet Co., Ltd. (Guizhou High People’s Court/(2017) Qian Min Zhong No. 822)

This case mainly illustrates the criteria for recognizing public confusion in a trademark infringement case involving domain name.

The rights owner has trademark registration for the mark “jiayougo” in Class 35 while the Defendant uses jiayou9.com as domain name to conduct e-commerce for similar services. Guizhou High People’s Court finds that the use of “jiayou9.com” as a domain name by the Defendant would not cause consumer confusion. First of all, “jiayougo” and “jiayou9” are not highly similar and internet users usually adopt a more cautious attitude when identifying the sources of services through domain name. Secondly, the plaintiff fails to prove the use and fame of the mark “jiayougo” and therefore its protection scope should be limited. Thirdly, considering the operational habit of internet users, when searching with “jiayou” or “jiayougo” as keywords, it will not direct to the Defendant’s website. Last but not least, internet users could also distinguish the party’s services by the webpage of the Defendant’s websites. Given the above, the Defendant’s use of the domain name will not cause consumer confusion and therefore shall not be liable for trademark infringement.

  1. Shantou Desheng Food Company vs. Guangzhou Kangying Food Co., Ltd, and Jinan Huaiyin Jinfuguang Seasoning and Nuts Store (Shandong Jinan Intermediate People’s Court/(2016) Lu 01 Min Chu No. 1856)

This case involves the recognition of abuse of trademark rights.

Prior to the registration date of the Plaintiff’s cited mark (device mark), the Defendant had already used the mark on the same goods and the mark had obtained certain fame and influence. The legal representative of the Defendant also enjoys prior design patent rights for similar mark over the Plaintiff.  In addition, the Defendant is using the mark in a proper way without any bad faith. The Court finds the Plaintiff lacks justifiable basis for obtaining the mark as it should have known the Defendant’s mark when applying for trademark registration. As such, the Court recognizes that the plaintiff sued the prior rights owner with a mark obtained not in good faith and shall constitute abuse of trademark rights.

  1. Societe Jas Hennessy & Co vs. Penglai Liquor Co., Ltd. (Chongqing Yubei District People’s Court /(2016) Yu 0112 Min Chu No.17407)

This case involves the protection of a three-dimensional trademark.

When determining whether the alleged product infringed the Plaintiff’s three-dimensional trademark, the Court considered the following factors: i) the established connection between the unique bottle and the Plaintiff from the perspective of the relevant public; ii) the originality and distinctiveness of the bottle; iii) the similarity between the bottle of the alleged infringing product and the trademark rights of the Plaintiff.

Part II. Administrative Cases

  1. Trademark Invalidation – Michael Geoffrey Jordan Portrait Case (SPC/(2015) Zhi Xing No. 332)

This case involves the conflict between rights of portrait and trademark rights.

SPC has set out the criteria for the protection of rights of portrait in this case.  That is, the rights of portrait of an individual protectable by the law shall be identifiable. Among other identifiable figures, the facial figures are frequently used to identify a person from others and shall be the most important one. If the figures sought to be protected are not facial ones, the Plaintiff is under the burden of proof to submit sufficient evidence to prove the subject mark contains other figures that could be clearly linked to such individual.

For the subject case, the evidence submitted by the Plaintiff to prove the rights of portrait clearly demonstrate the facial figures, body posture, uniform number that could be easily linked to the Plaintiff by the general public, while the subject mark “” just has the basic frame of the person without other identifiable figures on the picture. What’s more, the Plaintiff does not enjoy rights for the body posture, which means anyone could complete the same movement of the picture, hence, just judging from the body posture, it could not be linked to the Plaintiff.

  1. Trademark Opposition – “滨河九粮液” (Bin He Jiu Liang Ye) Case (SPC/ (2014) Zhi Xing No. 37)

This case mainly involves the judgement of similarity of trademarks.

The marks at issue are “滨河九粮液” (Bin He Jiu Liang Ye), the opposed mark, and  “五粮液” (Wu Liang Ye), the cited mark. SPC reasons that the cited mark enjoys high fame on wine products and the general public is likely to treat “五粮液” (Wu Liang Ye) as the dominant and most recognizable part of the mark. It is also noted that “滨河及图” (Bin He & Device) trademarks were registered in 1988 and had established connection with Binhe Group, which means the characters “滨河” (Bin He) in the subject mark is capable of distinguishing source of origin of the products. Based on the above, the Court finds that the co-existence of the marks at issue would not cause customer confusion in the market and thus the applied mark shall be approved for registration.

  1. Trademark Invalidation – PAUL＆SHARK Case (SPC/(2017) Xing Shen No. 7174)

This case involves the recognition of prior copyright over a trademark registration.

SPC reasons that scratches, original copies, assignment of copyright and the copyright recordal certificate that was issued before the application date of the subject mark shall all be qualified to prove the pre-existing copyright. In addition, prior trademark application and trademark gazette as well as trademark registration of the copyrighted logo can also serve as preliminary evidence.

  1. Trademark Invalidation –“祁门红茶及图” (Qi Men Hong Cha & Device) Case (Beijing High People’s Court/(2017) Jing Xing Zhong No. 3288)

This case concerns the recognition of certification mark of geographical indication.

Geographical indication is served to indicate the geographical area where the products come from. If the geographical area indicated by the certification mark of geographical indication is improper, it will inevitably mislead consumers and the mark will fail to certify the place of origin and quality of the goods bearing such certification mark of geographical indication. As such, certification mark of geographical indication shall not be registered if the geographical area it defined is not accurate.  As in this case, the applicant of a certification mark of geographical indication cannot submit false documents, and is obligated to comprehensively illustrate the practical situation, such as any existing controversies regarding the scope of the geographical area.