China: Strengthening Protection Of Well-Known Trademarks

Last Updated: 28 June 2017
Article by Ling Zhao

--- ExxonMobil Obtains A Compensation of RMB4,500,000 (Typical Case of Beijing Intellectual Property Court)


(2014) Jing Zhi Min Chu Zi No. 143 Judgement Of First Instance of Beijing Intellectual Property court on Case of Dispute over Infringement of Exclusive Trademark Use Right between the Plaintiff XX Company and the Defendants Beijing Beinongguoxin Technology Development Co.,Ltd., Weifang Zhongke Agricultural Technology Development Co.,Ltd., Zhang Zhimin and Zhang Dandan

[Brief Introduction to the Case]

The Plaintiff XX Company lodged a complaint to Beijing Intellectual Property Court by the reason that, its priorly registered trademarks "美孚" and "MOBIL" constituted well-known trademarks on lubricant oil goods after long-term broad use and publicity in China, and the Defendant's trademarks " ", "美孚" and "MOBIL" ("Infringing Trademarks") used on the goods pes-ticides and fertilizers infringed its prior trademark right. Beijing Intellectual Property Court found after trial that, both Beinong Company and Zhongke Company did the behaviors of producing, selling and promoting the complained Mobil series goods. Zhang Zhimin, as the registration applicant and licensed user of the Infringing Trademark " ", committed the infringing behavior together with Beinong Company and Zhongke Company, and so shall assume several and joint liabilities. Zhang Dandan, as the filed operator and actual operator of the infringing website, implemented the complained behavior together with the other Defendants through work division and cooperation, and shall also assume infringement responsibilities together with other Defendants.

The Court held that, from 2012 to the date when the Plaintiff lodged a complaint in this case, the Plaintiff's trademarks "美孚" and "MOBIL" constituted well-known trademarks used on lubricant oil goods. Both the complained goods and the Plaintiff's lubricant oil goods belonged to chemicals, they had certain degree of relevance, and the use of Infringing Trademarks would induce the legal consequence of cross-class confusion among some of relevant public. Meanwhile, the lubricant oil goods on which the Plaintiff's well-known trademarks are used will possibly be applied to household goods like cars, etc. with ordinary social public as consumers, while the relevant public using the complained goods like fertilizers and pesticides, etc. are also covered in the ordinary social public, so the relevant public of the complained goods have cognition with the trademarks "MOBIL" and "美孚" on lubricant oil. In consideration that "美孚" belongs to a fabricated Chinese phrase, and after use, "MOBIL" and "美孚" have formed corresponding relationship and have had very high popularity, so under such circumstances, the use of Infringing Trademarks would induce the legal consequence that the distinctiveness of the Plaintiff's well-known trademarks is diluted.

Finally, the Court judged that the four Defendants should assume several and joint liabilities for the damages and reasonable expenditure of RMB4,500,000 claimed by the Plaintiff.

Strengthening Protection of Well-Known [Abbreviature of Adjudication]

1. The Plaintiff claimed for damages based on its exclusive right to use well-known trademarks. The use of Infringing Trademarks will possibly induce the legal consequences of not only the cross-class confusion of relevant public, but also the dilution ofthe distinctiveness of the Plaintiff's well-known trademarks. The generation of confusion surely means that each Defendant improperly uses the popularity of the Plaintiff's trademarks, and the generation of dilution means the devaluation of the Plaintiff's trademarks, so the complained behavior will not only bring about losses to the Plaintiff, but also bring about benefits to the Defendant. Therefore, even though the Defendants did not use the complained trademarks on lubricating oil goods, each Defendant shall still assume the responsibility to compensate the Plaintiff for their complained behaviors.

2. Based on the fact that the Defendants alleged they ranked among the Top 100 Pesticide Enterprises in 2009, Top 50 Pesticide and Insecticide Enterprises in China in 2010, as well as the Top 50 Pesticide (Insecticide, Bactericide, Herbicide) Enterprises in China in 2012 and 2013, it may be presumed that, over the past two years, their annual gross sales of pesticide goods should be more than RMB100,000,000, far more than the compensation amount of RMB4,500,000 claimed by the Plaintiff, and so the Court fully supported the claims.

[Typical Significance]

Beijing Intellectual Property Court considered that, the typical significance of this case rests with that, the on-demand recognition and protection of well-known trademarks shall be considered from the aspects of stopping infringement and compensating losses in civil litigations. Generally, where a trademark registered by the trademark registrant on identical or similar goods is enough to make this trademark registrant obtain the protection which is of the same level as that for a well-known trademark, then it will be unnecessary to provide protection of well-known trademark for the trademark right holder. The protection of the same level shall be considered from at least two aspects, namely stopping infringement and compensating losses. Where the trademark registered by the trademark registrant on identical or similar goods could only stop infringement behaviors, but could not obtain economic compensation, then it shall be recognized that, the trademark registered on identical or similar goods cannot obtain protection of the same level as a well-known trademark, and in line with the on-demand recognition principle, it will be necessary to provide the protection of well-known trademark level for the trademark registrant.

Note: This decision was appealed to Beijing High Court.

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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