The recent judgement issued by the Jiangsu High Court for the dispute between the French National Cognac Industry Office and Ford Motor has sparked some discussions among IP professionals.
It's the first case where the Anti-unfair Competition Law is cited by the court to protect a foreign GI across industries in China. Let's take a close look at the case.
Background
"Cognac", as the first GI registered in China, represents the quality of the specific brandies produced in the Cognac region of France and has rained significant recognition among the relevant public.
Ford, the multi-national automaker, uses the term "Cognac Special Edition" to name some of its car models which feature brown exterior and interior colors.
When searching the key words "Ford, Cognac brown" online, a large amount of promotional materials can be located on mainstream auto websites, and various explanations with comparisons are found too to highlight the difference between the "Cognac Special Edition" cars and their regular versions.
The notable phrase, "Not all brandies are cognac, and not all Ford are called Cognac", are quoted to enhance the unique style and the refined taste of these cars named with "Cognac".
Court Ruling
The Cognac Industry Office believes that Ford's use of the "Cognac" GI for advertising their products constitutes unfair competition and brought the case to the Suzhou Intermediate People's Court.
In the first instance judgement, the court ruled that Ford shall immediately cease using "Cognac" as the name of its car color and compensate RMB 2 million to Cognac as economic loss and reasonable expenses.
Ford then filed an appeal with the Jiangsu High People's Court, which, in the second instance trial, upheld the initial verdict and dismissed the appeal.
Some Takeouts
While it's quite common to use 'cognac brown' to describe a shade of rich and warm brown color for shoes, leather sofas, bags, etc., the term 'Cognac' is not included as a generic name in China's color regulations.
Cognac believes that Ford should be aware of the famous GI and apply stricter criteria when naming its vehicle models to prevent infringement of others' interests. In this sense, the court has taken the importance of preventing the potential risk of generalizing the GI into consideration, and accordingly deems that Ford's use of "Cognac" on cars could weaken the GI's original meaning and pose risks of making it a generic name.
Another point to notice is that, although the two parties' products seem irrelevant, in the current trend of diversified development of modern industries, cross-border cooperations is becoming increasingly common.
Therefore, Ford's use of "Cognac" is likely to create confusion and mislead the relevant public into thinking that there is specific connection between these vehicles and Cognac, thereby constituting unfair competition.
Last but not least, while the Trademark Law specifies that GI can be protected under it, it doesn't exclude the possibility that GIs can also be protected under other laws. Seeking remedies for GI protection through Anti-unfair Competition Law serves the dual purpose of maintaining competition order and safeguarding the interests of businesses and consumers.
To determine if certain actions constitute unfair competition, it's crucial to assess whether they disrupt the market competition order or harm the legitimate rights of the others.
In light of this, Ford's actions have been considered by the court as in violation of the good faith principle.
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