Most Read Contributor in Hong Kong, September 2016
In 2013 Moncler S.P.A. ("Moncler")
became aware of the manufacture and sale of down jackets by Beijing
Nuoyakate Garment Co., Ltd.
("Nuoyakate"). Nuoyakate used marks and
logos confusingly similar to Moncler's marks on its products
and also applied for the registration of several trademarks and
domain names confusingly similar to Moncler's marks in China
and other key markets. In November 2014, Moncler brought an action
against Nuoyakate for trademark infringement and unfair competition
in China's newly established Intellectual Property Court in
Beijing ("IP Court"). The IP Court
awarded Moncler an unprecedented high amount of damages. We look at
the reasoning behind this award below.
In December 2014, the IP Court issued a judgment against
Nuoyakate for trade mark infringement and unfair competition. The
IP Court found that Nuoyakate had knowingly and without the trade
mark owner's prior authorisation, used trade marks which were
confusingly similar to Moncler's trademarks in Nuoyakate's
advertisement and promotional activities for the sale of down
jackets and accessories. Nuoyakate was also found to have
registered the domain name mockner.com which was confusingly
similar to Moncler's "MONCLER" trade mark.
Nuoyakate was ordered by the IP Court to pay unprecedented
maximum statutory damages of RMB 3 million (around US$448,000) to
Moncler. The IP Court also ordered Nuoyakate to shut down its
website at mockner.com and to cease selling clothes that infringed
Even though Moncler did not produce any evidence of actual loss
suffered, and Nuoyakate did not disclose its sales volume or the
amount earned by it in relation to the infringing use of
Moncler's marks, the IP Court was nevertheless willing to order
the maximum statutory damages under the new Trademark Law
(effective 1 May 2014). The IP Court's decision was based on
Moncler had been well-known in the Chinese market since at
Nuoyakate's website to which the domain name mockner.com resolved, displayed goods
bearing marks that infringed Moncler's trademark rights, which
constituted evidence of bad faith;
Nuoyakate failed to produce evidence to establish its
manufacturing volume and revenue made from sales;
Nuoyakate sold the infringing goods at high prices;
Nuoyakate deliberately did not print its own company name on
the label of the down jackets, which is evidence of malicious
Nuoyakate was a large-scale infringer and in the process of
setting up a commercial network including franchising stores and
Encouraging Message to Brand Owners
Moncler is reportedly the first petitioner awarded the maximum
statutory damages of RMB 3 million (US$448,000), since the new
Trademark Law came into effect in May 2014. Before the new law, the
maximum damages available was only RMB 500,000 (US$80,000). As
stated by Moncler: "[t]his is a ground-breaking case, believed
to be the first judgment under China's new trademark law to
grant maximum statutory damages in cases of
The PRC IP Court is clearly intent on taking a firmer approach
to crackdown on the rampant trademark infringement in the country.
This landmark case sends an encouraging message to brand owners
facing challenges and uncertainties in enforcing their rights
through litigation 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
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