China: China's Gradual Acceptance Of Non-Traditional Trade Marks

Last Updated: 29 May 2019
Article by Rosita Li and Vivian Or

As are result of the amendments made to the PRC Trade Mark Law that came into effect on 1 May 2014, "non-traditional trade marks" (i.e. not word and/or figurative marks) do not just include colour marks and three-dimensional marks but also include sound marks.

Since 2014, we have seen China's gradual acceptance of non-traditional trade marks. Notwithstanding this encouraging development, obtaining registration for non-traditional trade marks is not simple and straightforward. Owners of non-traditional trade marks are advised to be prepared to put up a fight before achieving registration as non-traditional trade marks are still fairly new in China. Take colour marks as an example: Article 8 of the PRC Trade Mark Law provides specifically that "colour combination" is registrable as a trade mark in China. However, according to the Chinese Trade Mark Examination and Review Standard (the "Standard"), single colours explicitly listed as marks are not registrable as they are considered devoid of distinctive character. The examples of non-registerable marks given by the Standard are "" and "". As a result, it is not surprising that previous applications to register single colour marks such as "" and "" have all been refused. Recently, the Beijing High Court held that a single colour applied to a specific position can be registered under the PRC Trade Mark Law and the first sound trade mark was granted through judicial proceedings in China. These two cases and the insights as to the types of non-traditional trade marks that the Chinese Courts have accepted, are discussed below.

Louboutin's colourful victory in China

Christian Louboutin, a well-loved and well-known French shoe designer, successfully extended the protection of its red-soled trade mark to China via a Beijing High Court ruling.

In 2010, Christian Louboutin obtained an International Registration for its signature red-soled trade mark. (shown in image A. below) in Class 25 in respect of "Ladies footwear" under no. 1031242. The Trade Mark is described as: "The mark consists of the colour red (Pantone No. 18.1663TP) applied to the sole of a shoe as shown in the representation (the outline of the shoe is not part of the mark, it is for illustration only)". For almost a decade, Christian Louboutin has fought to obtain protection of the Trade Mark by seeking to extend the International Registration to China. It is worth noting that whilst the goods originally sought to be protected in 2010 are "Ladies footwear", the goods have been limited to "High-heeled ladies footwear" with effect from 2013.

Brief background

Christian Louboutin applied to extend protection of the International Registration of its Trade Mark to China in April 2010. The Trade Mark was refused by the Chinese Trade Mark Office ("CTMO") in October 2010 due to it being devoid of any distinctive character in respect of the designated goods (ladies footwear). Christian Louboutin filed a review with the Trade Mark Review and Adjudication Board ("TRAB") against the CTMO refusal. As the TRAB maintained the CTMO refusal, Christian Louboutin appealed to the Beijing Intellectual Property Court (the "IP Court") against the TRAB decision.

The IP Court ruled in favour of Christian Louboutin, quashed the TRAB's decision, and ordered the TRAB to reissue the Review decision. Both the TRAB and Christian Louboutin appealed against the IP Court's judgment: the TRAB appealed requesting to quash the IP Court's ruling, whereas Christian Louboutin appealed against the reasoning of the IP Court on the basis of maintaining the IP Court's ruling. The case then went to the Beijing High Court (the "High Court").

Grounds of Appeal

The TRAB appealed against the IP Court's finding that the TRAB wrongly identified the Trade Mark as a figurative trade mark.

Although the IP Court found in favour of Christian Louboutin, they filed an appeal on the following grounds:

  1. The IP Court misunderstood the components of the Trade Mark and the protection sought and erred in including the shape of the high-heeled shoe, outlined in dotted line, as an element of the Trade Mark;
  2. The IP Court erred in finding that the Trade Mark is a 3-dimensional trade mark; and
  3. The Trade Mark is inherently distinctive and the Trade Mark is capable of identifying trade origin. Even if the Trade Mark is not inherently distinctive, it has acquired its distinctiveness through extensive use and promotion. The fact that the Trade Mark is successfully registered in other jurisdictions illustrates that the Trade Mark has acquired the necessary distinctiveness required for registration.

The Judgement

The High Court dismissed the TRAB's appeal, and allowed Christian Louboutin's appeal in part. The High Court ruled that when examining a trade mark which is an extension of an International Registration, the trade mark and its specific components should be determined by the particulars as published by in the World Intellectual Property Organization ("WIPO") records.

In this case, the TRAB in the Review decision decided that the Trade Mark is a figurative mark consisting of a common high-heel shoe and a single colour on the sole which is not distinctive to function as a trade mark. Instead of correcting the TRAB's mistake, the IP Court went further and considered that the Trade Mark includes the high-heeled shoe outlined in dotted line and the sole of the shoe in solid line and filled in red. The IP Court concluded that the Trade Mark is a 3-dimensional mark of the shape of a high-heeled shoe with the colour red filling part of the shoe. The High Court found that both the TRAB and the IP Court erred in having wrongly identified the elements constituting the trade mark to be examined. By referencing the description of the Trade Mark as recorded on the WIPO record, the High Court found that the Trade Mark comprises of the colour red at a prescribed place, which should be regarded as a single colour mark limiting its position of use. Based on this, the High Court upheld the IP Court's judgment in overruling the TRAB's decision, while correcting its factual finding.

Takeaway

This case is important as it is the first case in the history of China's trade mark law to allow protection as a trade mark for a single colour in a specific position. The case has now been returned to the TRAB for reconsideration and reissuance of a decision. It is not clear whether the TRAB will decide in favour of Louboutin in finding that a single colour applied to a specific position can be registered under the PRC Trade Mark Law, as is the view of the High Court. We also see the Chinese High Court's willingness to consider the description of a trade mark outside China (in this case WIPO) when it comes to deciding the elements of the trade mark in question. We welcome the openness and willingness of the Chinese High Court in considering matters outside of the box and the acceptance of registration of non-traditional trade marks. We anticipate to see more encouraging and novel judgments in the future.

Tencent's victory in registering "Di Di Di Di Di Di" as a Trade Mark

The next case sees the first registration of a sound mark through judicial proceedings in China.

In 1999, Tencent launched its instant messaging software, QQ. Since then, QQ became one of the most popular instant messaging software in China.

Since the amendment to the Trade Mark Law of China in May 2014, sound marks have been registrable as trade marks . In May 2014, Tencent applied to the CTMO for registration as a trade mark for services (including "message sending") in Class 38 its QQ notification sound "Di Di Di Di Di Di" ("the Sound Mark") which signals an incoming message. The CTMO rejected the application on the basis that the Sound Mark lacks distinctiveness. Tencent appealed by filing a Review with the TRAB. The TRAB upheld the CTMO's decision, finding that the Sound Mark is indistinctive.

Tencent appealed further to the IP Court against the TRAB's decision. "Di Di Di Di Di Di" is the first sound mark application that was heard by the IP Court.

The IP Court's Decision

The IP Court ruled in favour of Tencent, quashed the TRAB's decision, and ordered the TRAB to reconsider the Review. The IP Court ruled as follows:-

  1. The Sound Mark has its special rhythm and sound effect which cannot be commonly found in daily life. The Sound Mark is not a simple sound as found by the TRAB.
  2. The Sound Mark has acquired distinctiveness through its long-term and extensive use in China. The evidence provided by Tencent showed that the Sound Mark has been widely and continuously used since 1999. A stable corresponding connection between the Sound Mark, the QQ software and Tencent has been established. The Sound Mark is capable of identifying trade origin via actual use.
  3. The Sound Mark is non-functional, as it is the result of an artificial setting, instead of a direct result from the operation of the QQ software. The TRAB appealed to the High Court against the IP Court's judgment.

The TRAB's Grounds of Appeal

The TRAB's grounds of appeal were as follows:

  1. The Sound Mark is simple and indistinctive. The Sound Mark is commonly used by electronic devices as a warning or notification signal.
  2. The Sound Mark is only used in QQ software to signify one particular function.
  3. The evidence provided cannot prove that the Sound Mark could assist the public in identifying the origin of services.

The Judgment

Although the High Court agreed with the TRAB and the IP Court's findings that the Sound Mark is not inherently distinctive, the High Court affirmed the IP Court's finding that the Sound Mark has acquired distinctiveness to function as a trade mark through long-term and continuous use. From the evidence provided by Tencent, the High Court found that the public is capable of identifying the origin of services as Tencent by the long term and continuous use of the Sound Mark on QQ software. The High Court upheld the major ruling of the IP Court but rejected Tencent's application for the services of "television broadcasting; news agencies; and teleconferencing services" since the Sound Mark had not been used for these services. The remaining services in Class 38 "providing online forums; computer aided transmission of messages and images; providing internet chatrooms; transmission of greeting cards online; electronic mail; message sending; transmission of digital files" have been approved.

Takeaway

This case demonstrates the PRC courts' willingness to recognise sound marks as registrable trade marks. As Tencent's Sound Mark was allowed on acquired distinctiveness, it is not clear what the standard required for accepting sound marks on a prima facie basis will be. In order for a sound mark to be registered as a trade mark, the sound mark should be capable of distinguishing trade origin and should not be functional. Whilst the High Court judgment sets a good reference for the standard required for establishing the acquired distinctiveness required of a sound trade mark, the standard for the test of the non-functionality of a sound mark has yet to be further defined and clarified. In this case, the courts have made it said that a sound could acquire the distinctiveness for trade mark registration if the applicant could show that there is a long-term and continuous use of the sound, and the public could exclusively associate the sound with the trade origin. Further, the IP Court commented that the sound should be non-functional in order to be registrable as a trade mark. However, the courts did not provide the test for determining whether a sound is functional or not. In this case, the IP Court held that the Sound Mark is non-functional since it is the result of an artificial setting rather than an inevitable result of the operation of the software. However, arguably all digital sounds are the results of artificial setting, so this reasoning is hardly a helpful guideline, and it is not clear when a sound would be regarded as a result of artificial setting.

Nevertheless, this case still provides a useful guidance on how an applicant could establish the acquired distinctiveness of a sound trade mark.

Conclusion

The two cases highlighted in this article illustrate the evolution of the PRC Trade Mark Law as far as non-traditional trade marks are concerned. However, Chinese authorities are not bound to follow precedents, and each case is factually different from the other. There is, for now, still uncertainty as to what marks warrant registration but these developments should encourage non-traditional trade mark holders to try to register their non-traditional trade mark(s) in China.

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This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein. Please also read the JSM legal publications Disclaimer.

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