ARTICLE
21 June 2023

Lululemon Won RMB 1 Million In Damages

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The Meizhou Intermediate Court of Guangdong concluded a first-instance judgment on the trademark infringement dispute between Canada Lululemon Sports Goods Co., Ltd. ("Lululemon")...
China Intellectual Property

The Meizhou Intermediate Court of Guangdong concluded a first-instance judgment on the trademark infringement dispute between Canada Lululemon Sports Goods Co., Ltd. ("Lululemon") and an individual Zhang. The court ordered Zhang to immediately stop trademark infringement and compensate Lululemon for economic losses of RMB 1 million (approx. USD139,446).

The court found that Lululemon owns registered trademarks such as "1332538a.jpg," "LULULEMON", "Lu Lu Le Mon in Chinese," and "ALIGN." The said trademarks are registered and valid and shall be protected by the law.

In this case, the alleged infringing goods were identical or similar to those for which Lululemon has the exclusive right to use registered trademarks. The promotional information of the accused online shop and the logos of "Lu Lu Le Mon in Chinese," "LULULEMON," "1332538a.jpg," and "ALIGN" used on the relevant goods all serve to identify the source of the goods, which constituted trademark use. The said marks used by Zhang were indistinguishable from the registered trademarks claimed by Lululemon, which constituted identical marks. Zhang's behaviors were enough to cause confusion and mislead the relevant public, which infringed Lululemon's trademark rights.

In this case, Lululemon claimed that the profit from infringement was much higher than the amount of RMB 1 million claimed by Lululemon, regardless of calculating based on the Zhang's profit margin, the industry's profit margin, the profit margin of listed companies in the same industry, or the cost price of the counterfeit goods. The court supported Lululemon's claim for the compensation amount. The court comprehensively considered Zhang's degree of subjective fault, infringement profits, nature of infringement, operation method, operation scale, duration, sales amount and other factors, combined with the fame of Lululemon's registered trademarks, and the reasonable and necessary cost paid by Lululemon to stop the infringement in finding that Zhang should pay Lululemon for economic loss of RMB 1 million (apprx. USD139,446) (including reasonable expenses for stopping the infringement).

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