China: Beijing Higher Court Backs WANCHAI FERRY In The Fight Against Bad-Faith Applications

General Mills Asia, owner of the trademark "WANCHAI FERRY in Chinese characters" obtained a victory against a trademark squatter before the Beijing Higher Court. The court affirmed the well-known status of the Cited trademark on dumplings and adopted the "dilution" theory to reject the bad-faith applications of the opposed trademarks "WANCHAI FERRY in Chinese Character & Pinyin".

Case Brief

Wanchai Ferry is a leading brand of frozen food like dumplings and Tangyuan owned by General Mills Foods Asia Limited ("General Mills Asia"). On December 21, 1998, General Mills Asia applied to register the trademark "WANCHAI FERRY in Chinese & Device" ("Cited Mark") in respect of dumplings, meat pies, flour products, etc. in Class 30 in China and obtained the registration on August 7, 2002.


Cited Mark

On May 25, 2010, a Chinese company named Zhengzhou Tangming Trading Co., Ltd. ("Tangming") applied to register the trademarks "WANCHAI FERRY in Chinese + Wanzaimatou (pinyin equivalent to the Chinese name)" in respect of cleaning preparations, cosmetics, dentifrices, incense, etc. in Class 3, containers, not of precious metal, for household or kitchen use, glassware, toothpick holders, not of precious metal, thermally insulated containers for food, etc. in Class 21, and freighting, car transport, storage of goods, booking of seats, etc. in Class 39.


Opposed Marks

In May 2011, General Mills Asia raised oppositions but was dismissed by the China Trademark Office ("CTMO"). General Mills Asia appealed to the Trademark Review and Adjudication Board ("TRAB") in September 2012 but was dismissed again. CTMO and TRAB held the goods and services covered by the Opposed Marks were different from that covered by the Cited Mark in terms of functions, use purposes and target consumers, and the evidence was insufficient to prove that the Cited Mark was well-known before the filing date of the Opposed Marks.

General Mills Asia filed an appeal before the Beijing No.1 Intermediate Court, claiming that after extensive use and advertising, the Cited Mark had reached the well-known status before the filing date of the Opposed Marks, and that the Opposed Marks were a duplication of its trademark, which was in violation of Article 13.2 of the 2001 Trademark Law. Tangming replied that the name "Wanchai Ferry" is a geographic name and that the evidence produced is insufficient to prove the well-known status of the Cited Mark.

In May 2016, the Beijing No.1 Intermediate Court ruled in favor of General Mills Asia, ordering the TRAB to re-make the decisions based on the following reasons.

  1. The evidence submitted by General Mills Asia can prove that the Cited Mark has been used on dumplings in China since 1998, and the products bearing the Cited Mark enjoy a leading position in respect of sales amount, market share and ranking. Moreover, the products bearing the Cited Mark are extensively advertised on national scale, and have obtained several awards. Therefore, the Cited Mark was widely known by the relevant public before the application date of the Opposed Marks, and the Cited Mark shall be recognized as a well-known trademark on dumplings.
  2. The Opposed Marks contains the characters "WANCHAI FERRY in Chinese" of the Cited Mark, which is highly similar to the Cited Mark "Wanchai Ferry in Chinese" in terms of appearance, pronunciation and meaning. So the Opposed Marks constitute the copy and imitation of the Cited Mark.
  3. Although the goods and services covered by the Opposed Marks in Classes 3, 21 and 39 are dissimilar to the "dumplings" designated by the Cited Mark, there is an overlap of the relevant public of such good and services. The use of the Opposed Marks is likely to mislead the relevant public to associate the Opposed Marks with the Cited Mark and misconstrue the origin of goods and service. Therefore, the Opposed Marks would weaken the distinctiveness of the Cited Mark, take advantage of the market reputation of the Cited Mark, and harm the legal interest of General Mills Asia, which constitutes the circumstances as stipulated in the Article 13.2 of the 2001 Trademark Law.

Both the TRAB and Tangming appealed to the Beijing Higher Court claiming that the evidence submitted by General Mills Asia does not suffice to prove the well-known status of the Cited Mark, and that the goods and services designated by the Opposed Marks are quite different from the goods of the Cited Mark, so the Opposed Marks would not damage the interests of General Mills Asia.

In October 2016, the Beijing Higher Court rejected the appeal and maintained the judgments of the first instance. The Beijing Higher Court affirmed that the evidence was sufficient to prove the well-known status of the Cited Mark and found that in light of the fact that Tangming used to be an authorized agent of Wanchai Ferry brand, it hardly acted in good faith when filing the application of the Opposed Marks.

WAN HUI DA – PEKSUNG represented General Mills Foods Asia Limited in these proceedings.

Comments:

Along with the constant increase of trademark applications in China, brand owners are facing increasing challenges from bad-faith applications, especially those applied in respect of dissimilar goods and services. In the past few years, when the goods covered by the conflicting trademarks could be considered as somewhat remotely related, the CTMO and TRAB were more flexible and active in rejecting bad-faith applications. They held that the goods were similar, even against the official Classification of Similar Goods and Services, and/or they used the general clause of "unhealthy consequences" as an "absolute ground". Nevertheless, when the goods and services of the involved trademarks are really dissimilar, the brand owner still has to obtain the recognition of well-known trademark.

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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