Author: Cissy Zhou, Cai Chongshan, Intellectual Property, King & Wood Mallesons

Key issues：

The goods partially refused in the trademark examination could be used to deduce that the disputed trademark owner intended to make confusion with the cited trademarks, which facilitates determining goods designated by the disputed trademark in different class/subclass similar to those designated by the cited marks as prior rights.

Case summary：

Recently, the China National Intellectual Property Administration(hereinafter referred to as “CNIPA”) decided that the disputed trademark designated on “shower caps” and the citations designated on “clothing; shoes; hats; hosiery; gloves (clothing); scarves; belts (clothing); down garments; leather belts (clothing); fur coat (clothing)” goods as similar trademarks on similar goods that would cause consumer confusion. Finally, the disputed trademark is determined to be invalidated in the “No. 20148247 ‘地素佳人’ (“DI SU JIA REN” in Chinese Characters) trademark invalidation ruling (ruling reference: 商评字[2019]第0000130418号(“Shangpingzi [2019] No. 0000130418” )).

In the case, the disputed trademark is “地素佳人”( “DI SU JIA REN”) and the remaining goods approved to register are “shower caps” in class 25 after the preliminary examination. King&Wood Mallesons, as the agency of the prior right holder of trademark“地素” (“DI SU” in Chinese Characters), filed the invalidation against the disputed trademark claiming that the disputed trademark “地素佳人”(“DI SU JIA REN”) is similar to the citations “地素” (“DI SU”), “地素时尚” (“DI SU SHI SHANG” in Chinese Characters) and “素地” (“Su Di” in Chinese Characters). Even though the disputed trademark is designated on “shower caps” which is considered dissimilar with one of the citations according to the Chinese Classification Book for Similar Goods and Services (hereinafter referred to as “Classification Book”). Considering that the goods of both trademarks are extremely relevant in aspects of functions, purposes, raw materials, production departments, sales channels, sales places and target consumers, the goods should be deemed as similar goods. When the disputed trademark and the citations are used on similar goods, it is likely to cause confusion to the relevant public or make the public believe that there is a specific relationship between the two trademarks. The two trademarks constituted similar trademarks designated on the similar goods.

The CNIPA held that the citations “地素” (“DI SU”) and “素地” (“Su Di”) are make-up Chinese characters without fix meanings but with distinctiveness. Before the application date of disputed trademark, the citations had obtained a certain degree of reputation on the clothing goods. The comprised words as well as the pronunciation of the disputed trademark and citations are similar, which is likely to cause the relevant public misunderstand that the two trademarks are series trademarks or have special relationship. Therefore, the two trademarks constituted similar trademarks. The “shower caps” designated by the disputed trademark is also strongly relevant with citations’ clothing goods approved in class 25, and the disputed trademark also claimed clothing, outer clothing, layettes (clothing), footwear, hosiery, gloves (clothing) , scarfs, girdles in the application request. The owner of disputed trademark is obviously intended to make confusion with the prior “地素” (“DI SU”) trademarks. Given the above, the registration of disputed trademark is likely to make the relevant public mistakenly believe the disputed trademark on the “shower caps” is the series trademark of citations that leads to the confusion among relevant public and misidentification of the source of goods. Finally, the disputed trademark designated “shower caps” constituted the similar trademark using on the similar goods with the citations violating Article 30 of Trademark Law and relevant regulations.

Comments：

This case is a typical example that breaks the Classification Book and provides a new approach to prove bad faith of the trademark applicant.

1. “The intention of confusion” is a strong evidence to claim breaking through the Classification Book and prove the constitution of “similar goods” regulated in accordance with Article 30 of Trademark Law.

For the issue of whether the goods designated by two trademarks constitute similar goods or not at the administrative stage, the CNIPA mainly relies on the Classification Book as the basis for examination in order to maintain the coherence of the examination standard.

The former Trademark Review and Adjudication Board formulated the conditions of breaking through the Classification Book meeting the legislative purpose of the Trademark Law, which upholds the good faith principle. The following elements shall be considered in order to break the Classification

  • The prior mark has significant distinctiveness.
  • The prior mark has obtained a certain reputation.
  • The disputed trademark is confusingly similar to the prior mark.
  • The goods or services on which the disputed trademark was designated have strong relevance to the goods or services approved for use of the prior mark.
  • The bad faith of the owner of disputed trademark is obvious.
  • The registration or use of the disputed trademark is likely to cause confusion and misunderstanding among the relevant public.

The ruling of invalidation against “地素佳人” (“DI SU JIA REN”) concluded that the citations are similar to the disputed trademark based on the affirmation of the distinctiveness and reputation of the citations. CNIPA took further step to take into account the subjective intention of the applicant when applying for the disputed trademark when judging the similarity of goods. If the applicant’s intent is not to use the disputed trademark to accumulate goodwill in good faith, but to create confusion by imitating other’s famous brand, the applicant should be treated as having obvious bad faith. Under such circumstances, the goods designated by the disputed trademark would be similar to the goods designated by the citation.

This standard of examination is also in line with Article 18 of the “Opinions of the Supreme People’s Court on Several Issues Concerning the Utilization of the Judicial Function of Intellectual Property Rights to Promote the Development and Prosperity of Socialist Culture and Economy” (reference number: 法发[2011] 第18号 (“Fafa [2011] No. 18”)), which stipulates: “Discretionary legal standards, regarding similarity of trademarks, similarity of commodities, prior use of trademarks that are already of certain influence, obtainment of trademark registration by fraud or other unjustifiable means, and so on, shall be appropriately applied in light of the popularity, distinctiveness, and so on of the trademarks. Whether trademark registration applicants or registrants have a real intention to use the trademarks shall be well identified, and the subjective malice shall be determined in consideration of imitation of famous brands in the process of trademark use. The relevant provisions of the trademark law shall be applied sufficiently and correctly to strengthen containment of malicious preemptive registration, imitation of famous brands, and other improper acts and fully embody the orientation of law for the protection of trademark rights.” The State Market Supervision and Administration promulgated the “Regulations on Regulating Trademark Registration Acts” (hereinafter referred to as “Regulations”), implemented on December 1, 2019, to regulate the acts of trademark application and registration, stop the trademark application in bad faith and keep the management of trademark registration in order. In this case, the applicant’s intention of confusion is one of the factors to judge the likelihood of confusion from the consumers, which also reflects the trend to stop any trademark application in bad faith.

2. The goods that has been refused at the stage of examination can be used to deduce the applicant was in bad faith with the “intention of confusion”.

The aforementioned fifth requirement to break through the Classification Book, “the bad faith of the disputed trademark owner is obvious”, needs to be supported by evidences. In this case, CNIPA inferred the applicant’s bad faith in imitating famous brands by the partially refused goods claimed by the owner of the disputed trademark. Given such, the CNIPA deemed that the applicant had bad faith when applying for the disputed case, thus taking it into account as one of the elements for determining the goods designated by the disputed trademark similar to those designated by the prior marks, albeit they are in different subclasses.

In conclusion, this case provides a new idea of proving the applicant’s bad faith, that is to say, taking the refused goods into consideration when examining the intention of the applicant. When proving the designated goods constitute similar goods to those designated by the prior marks, not only the approved goods need to be examined, but also the refused goods. This would hopefully help brand owners to fight against bad faith applications with a new approach.