Guangdong JDB Beverage Company Limited ("JDB") filed a
lawsuit against Wong Lo Kat in Chongqing's First Intermediate
People's Court (the "Court"), alleging that Wong Lo
Kat's advertisement slogan of "a bottle of Wanglaoji takes
the fear of Shŕnghuo( (i.e. excessive internal heat a cause
of disease in Chinese perspective) away", constitutes unfair
competition. Although this case involved an advertisement slogan,
it was heard in the court according to the Anti-unfair Competition
Law rather than the Copyright and Trademark Laws, creating a novel
cause of action.
KWM lawyers represented Wong Lo Kat in the trial and made
submissions on the validity of the use of such advertisement slogan
by Wong Lo Kat based on the legislative purpose of the Anti-unfair
Competition Law. We won this case for our client by obtaining a
judgment of refusing all of the JDB's claims entered with the
In its judgment, the Court recognized that the advertisement
slogan of "a bottle of Wanglaoji takes the fear of
Shŕnghuo( away" is a direct statement of specific
herbal beverages' function to prevent internal heat, which in
itself has no inherent distinction or significance. Nevertheless,
through continued, frequent and extensive use by JDB for years, the
advertisement slogan in question develops a second meaning which
should be safeguarded by the protection under the Anti-unfair
Although it is the general principle under PRC intellectual
property law that the designer and the user of a product shall own
the rights, there are exceptions to this principle. When
determining the interest ownership of a mark, along with taking
creation, design and use of such mark into consideration, a
comprehensive evaluation shall be made on the basis of the purpose
of designing such mark and the actual benefit derived from using
such mark, as well as other relevant factors.
As held by the Court, "[f]or the purpose of this case,
despite the fact that the advertisement slogan involved in this
case was created and used by the plaintiff, the advertisement
slogan is tailor made for positioning and promoting the Wanglaoji
branded herbal beverage products, and is an important method to
promote and enhance the brand image of Wanglaoji." The
advertisement slogan in question, namely "*** takes the fear
of Shŕnghuo( away", is an orientation statement of the
product function whereas "a bottle of Wanglaoji" is the
targeted product, both of which constitute a complete and
indispensable description of the product. After cessation of
JDB's use of the trademark "Wanglaoji", Wong Lo Kat,
as the legal user of such trademark, is entitled to the legal
interests and benefits of the advertisement slogan involved in this
case that was tailor made for the brand "Wanglaoji" and
has been an undivided part of such brand. Wong Lo Kat's
continued use of the advertisement slogan obviously aims at further
maintaining or enhancing its original brand image with no bearing
of subjective malice such as "hitchhiking", harming
others to obtain personal benefits or extorting by trick or by
force. Thus, use of the advertisement slogan in question does not
involve illegitimacy. The Court ultimately rejected all of
Subsequent to the trademark dispute over "Wanglaoji"
and between Wong Lo Kat and JDB, another case related to renamed
advertisement between the parties arose, this case became another
notable anti-unfair competition lawsuit. The court judgment has
made thorough analysis and reasoning with regards to unfair
competition behaviors of the advertisement slogan from its
origination and specified clearly the legal interests being
protected by the Anti-unfair Competition Law and application of
this law. The finding of the Court has a tremendous impact on both
of the plaintiff and defendant.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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In June 2016, China's State Council issued its Opinions of the State Council on Establishing a Fair Competition Review System During the Development of Market-oriented Review System ("Opinions").
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