Jurisdiction - China
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China – Foreign Plaintiff Successfully Secures WKTM.
25 July, 2013
Legal News & Analysis – Asia Pacific – China – Intellectual Property

Plaintiff –  Zippo Manufacturing Company (“Zippo”, an U.S. company ) v. Defendant – Tangfeng Factory (“Tangfeng”) and its Legally appointed Representative Sun Menglin – decision by Zhejiang High People’s Court on 19 November 2012

 

In the captioned case, the Defendant Tangfeng is a Zhejiang, Chinese company manufacturing hand-warmers bearing an outlook of Zippo’s lighters together with the TM “Zippo” identical to that of Zippo lighters.  Its legally appointed representative, Sun Menglin sold such hand-warmers on-line.  Zippo sued Tangfeng and Sun Menglin for TM infringement and unfair competition, but lost at the Court of First Instance.

 

It was found that the Defendant had even tried to register the TM “Zippo” in Class 11 in China. However, its application was opposed by Zippo and was eventually refused by CTMO on the ground of bad-faith filing, because evidences revealed that the legally appointed representative of the defendant Sun Menglin had been engaged in the sample designing of the Plaintiff’s Zippo hand-warmers, and thus had full knowledge of the prior TM Zippo and its use.

 

After the failure at the First Instance, Zippo appealed to Zhejiang High People’s Court. After hearing the case, the Court found that although the TM “ZIPPO” was registered in Class 34 for lighters and Tangfeng used the TM “ZIPPO” on dissimilar goods, namely hand-warmers (classified under Class 11), the Court recognized the TM “ZIPPO” as a well-known TM and the use of the TM “ZIPPO” on dissimilar goods still constituted infringement of Zippo’s TMRs.  Consequently, both Tangfen and Sun Menglin were forbidden to manufacture and / or sell the infringing products, and Zippo was awarded damages of RMB 500,000.

 

In this case, Zippo, a foreign company made great efforts in combating against TM infringers in mainland China. CTMO and also the courts showed their willingness and determination to uphold justice and suppress TM squatters and infringers.

 

First of all, during the TM opposition, CTMO duly refused the improper registration of the infringer’s “Zippo” TM on the ground of bad-faith filing when it found that the infringer had prior knowledge of the use of Zippo’s use of the TM “Zippo” on hand-warmers.

 

In the course of the litigation, Zhejiang High Court also made a fair judgment by recognizing the Plaintiff’s TM “Zippo” as a WKTM in China. It should be mentioned that the “well-known” status of a TM has a high threshold, and can only be recognized with sufficient and qualified evidence.

 

A judge of the Zhejiang High Court during this case also said that although the court was very cautious in the recognition of WKTMs, it had done so in several cases over the years, including TMs of many foreign owners.

 

This case further revealed that the key to prevail in TM cases always must be made with substantial evidence. In this case, the evidence showing the Defendant’s prior knowledge of the Plaintiff’s prior TMRs, the Plaintiff’s promotional materials published in China, sales figures supported by audit reports, as well as sale conditions in China, all contributed to the success by Zippo.

 

Zippo’s success can be a role model for many IPR owners to follow.  IPR owners need to have faith in the enforcement of their TMRs in China and take action appropriately and speedily against infringers after a full evaluation of its rights. So long as the TM owners have in hand tenable grounds and substantial evidence, their continuous and effective efforts will pay off.

 

 

For further information, please contact:
 
Grace Li, Ella Cheong (Hong Kong & Beijing)
gli@ellacheong.com

 

Homegrown IP Law Firms in China 

 

International IP Law Firms in China

 

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