21 May 2018Simon Tsi and Michael Fu

Trademark Cases in China: Quality Evidence Is Key

In 2017, two cases were decided by Chinese courts that illustrate how much progress the Chinese legal system has made in its ability to render both professional and fair judgments.

Under Armour brought a case against a Chinese domestic company, TFL, for use of the mark, which infringed Under Armour’s prior rights to the mark. This was a complex and high-profile litigation.

The disputed mark was actually the combination of two registered marks which TFL asserted in its defense as a legal basis for using the disputed mark. At the same time, TFL registered a shell company in Hong Kong under the name “Under Armour (China) Co., LTD”, which Under Armour argued wholly plagiarized its registered trademark. TFL was planning a major launch of products bearing the mark in one to two months, which meant that Under Armour had little time to stop TFL from marketing the infringing products.

Under these tight circumstances, Under Armour provided a significant volume of evidence to prove the use and fame of its UNDER ARMOUR marks in China. In addition, the relevant court was asked to grant a preliminary injunction against TFL, and did so after hearing pleadings.

A preliminary injunction is a very rare occurrence in China, so securing the court’s agreement was a major accomplishment. The court subsequently rendered a judgment in favor of Under Armour, eventually deciding that TFL’s activities constitute trademark infringement and unfair competition against Under Armour, and ordered TFL to cease infringement, eliminate the influence, and compensate the plaintiff for its financial losses including reasonable expenses in the amount of CNY 2 million (US $316,300).

Further Success

In another case, the well-known brand owner Guinness World Records instituted a case against a China automobile company, Chery Automobile, in a claim for trademark infringement and unfair competition.

Guinness World Records is the trademark owner of the marks GUINNESS WORLD RECORDS and JI NI SI (吉尼斯, GUINNESS in Chinese). Chery held large-scale commercial activities using JI NI SI (吉尼斯) as well as the single word GUINNESS in at least 16 cities throughout China.

The defendant argued that it did not use the words as trademarks, but rather as generic words, and thus was not liable for trademark infringement. It also argued that its acts did not constitute unfair competition because its business was significantly different from the plaintiff’s, and that it did not use the plaintiff’s enterprise name.

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