The Chongqing First Intermediate Court recently made a decision regarding a dispute over trademark infringement between the plaintiff Guangzhou Aotiwa Biotechnology Co., Ltd. ("Aotiwa") and the defendant Chongqing Beigou Network Technology Co., Ltd. ("Beigou"). The court found that the Beigou did not infringe and dismissed Aotiwa's lawsuit.
Aotiwa registered the "
" mark with reg. no. 25792637
in Class 5, the "Niuruiyou in Chinese" mark with reg. no.
25797592 in Class 5, the "
" mark with reg. no. 61116472
in Class 29, the "Niuruiyou in Chinese" mark with reg.
no. 61114540 in Class 29. Aotiwa discovered that Beigou was selling
lactoferrin products with the " Niuruiyou in Chinese" and
"NEURIO" through the Taobao store "Zhengyige
Overseas Direct Mail Store" and believed that Beigou was
importing and selling without authorization and sued based on its
registered trademarks for RMB 10 million in compensation and RMB
500,000 in reasonable costs in stopping the infringement. Beigou
challenged Aotiwa's right to sue and argued that both the
accused infringing goods and the goods of Aotiwa and its subsidiary
"Niurui Trading Company" were imported from SUNNYA in
Australia. Beigou claimed that its products did not cause confusion
and its selling of these products did not constitute
infringement.
The court found that Aotiwa and Niurui Trading Company signed a "Trademark Exclusive Use Agreement" in 2017, agreeing that Aotiwa would authorize Niurui Trading Company to exclusively use its NEURIO-related trademarks registered in China from August 1, 2017 to July 30, 2027. SUNNYA is the owner of the "Niuruiyou in Chinese" mark and the "NEURIO" series marks in Australia and New Zealand. SUNNYA and Niurui Trading Company signed the "Product Agency Agreement" and "Agency Supplementary Agreement" successively in 2019, stipulating that Niurui Trading Company will be the general agent and import company of SUNNYA's Neurio products in China and be responsible for the sales in China. For sales and promotion in China, the cooperation period is from March 29, 2019 to March 28, 2024. It was also found that SUNNYA filed an application for invalidation of the above-mentioned marks on April 24, 2023.
Based on the pleadings of both parties, the court commented on the key issues in dispute in the case as follows:
1. Whether Aotiwa is a qualified plaintiff in this case. In this case, the registered marks with reg. nos. 25792637, 25797592, 61116472, and 61114540 are still valid. As the exclusive owner of the said marks, Aotiwa has obtained the right to sue for trademark infringement. Although Aotiwa authorized NEURIO-related trademarks registered in China to be used exclusively by Niurui Trading Company in China, Niurui Trading Company did not file a lawsuit against the infringement. Aotiwa as the owner of the registered trademark has the right to sue.
2. Whether Beigou infringes upon Aotiwa's registered trademark. First, the accused infringing goods falls into the approved use scope of the Aotiwa's registered trademarks. The accused infringing logo constituted identical marks with Aotiwa's. However, according to the traceability results of scanning codes, the accused infringing products were genuine. Second, SUNNYA is the overseas trademark owner of the "NEURIO" trademarks. The accused infringing goods sold by Beigou were authorized by SUNNYA. The accused infringing goods were purchased through cross-border e-commerce by Beigou from SUNNYA. The source of its goods was the same as that of Aotiwa. The acquisition method was legal. The evidence on record was sufficient to prove that the source of Beigou's goods was legal. Third, the evidence in the case proves that Beigou has reviewed the source and authorization status of the goods, which had fulfilled its reasonable duty of care and has no subjective intention to infringe. Therefore, the accused infringing products were genuine goods obtained through parallel imports. Beigou's store also clearly stated that the products had an official authorization letter from SUNNYA. The manufacturer, traceability code, and other information on the goods were also clearly stated. These goods will not cause consumers to confuse the source of the goods, nor will it impair the identification function of the trademark. The existing evidence was not sufficient to prove that the alleged infringement has affected Aotiwa's trademark's function of ensuring product quality or has the consequences of abusing or diluting the goodwill of Aotiwa's registered trademarks. Aotiwa's evidence was insufficient to prove Beigou's infringement. Accordingly, Aotiwa's claims cannot be established.
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