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China's Supreme People's Procuratorate (SPP) has released five typical cases concerning the punishment of malicious intellectual property litigation, covering utility model patents, design patents, trademark rights, and unfair competition across multiple intellectual property domains.
Among these, the case of Shenzhen Company A v. Wenzhou Company B and its Legal Representative X for trademark infringement was selected as one of the typical examples.
Basic Facts
In April 2017, Shenzhen Company A obtained the trademark at issue, registered for use on pillows and other goods in Class 20, with a validity period through April 2027. In November 2018, Company A's entrusted representative, accompanied by a notary, visited the business premises of Wenzhou Company B as a consumer and purchased a number of latex pillows and accessories, two of which bore the trademark at issue. In May 2019, Company A filed a trademark infringement lawsuit against Company B and its legal representative X before the Rui'an People's Court of Zhejiang Province.
In August 2019, the Rui'an Court rendered a first-instance judgment, holding that Company B had infringed the registered trademark and ordering it to cease the infringement and pay CNY 75,000 in damages and reasonable expenses, with X bearing joint and several liability. Neither party appealed.
Procuratorial Supervision
During routine case monitoring, the Rui'an People's Procuratorate identified unusual patterns in Company A's bulk enforcement activities. Through review of litigation files, retrieval of Company A's litigation data, and verification with market regulatory authorities, the procuratorate discovered that Company A had registered over 600 trademarks across various goods categories and had filed lawsuits against multiple latex product companies in Zhejiang Province since 2019, raising suspicion of malicious litigation. An on-site investigation confirmed that Company A had no actual business premises, no business activities, and no operational capacity. Its registered trademarks were not used in genuine commercial operations. Meanwhile, the trademark at issue had been invalidated by the CNIPA following a third-party invalidation request, and Company A had filed an administrative lawsuit challenging that decision. In 2024, both the Beijing Intellectual Property Court and the Beijing High People's Court ruled against Company A.
Considering Company A's operational status, the scale of its trademark hoarding, the number of lawsuits filed, and its litigation motives, the procuratorate concluded that Company A had engaged in malicious litigation.
In April 2023, the Rui'an People's Procuratorate issued a supervisory recommendation to the Rui'an People's Court, but the court declined to adopt it on the ground that the administrative litigation concerning the trademark had not yet become final. In November 2024, the Rui'an People's Procuratorate referred the case to the Wenzhou People's Procuratorate for a protest. In January 2025, the Wenzhou People's Procuratorate filed a protest with the Wenzhou Intermediate People's Court, arguing that the first-instance judgment was factually erroneous and that new evidence was sufficient to overturn the original decision.
In September 2025, the Wenzhou Intermediate People's Court rendered a retrial judgment, revoking the first-instance ruling and dismissing Company A's claims.
Significance of the Case
Where a trademark registrant registers and hoards a large number of trademarks without using them in actual business operations and seeks to obtain undue benefits through litigation, such conduct violates the principle of good faith, disrupts judicial order, and constitutes malicious litigation. When handling supervision cases involving malicious litigation, procuratorial authorities should actively leverage big data to screen and identify case leads. In assessing whether the plaintiff acted with malice, they should thoroughly investigate and verify the trademark registrant's business operations, litigation volume and motives, as well as trademark registration and usage, and make a comprehensive assessment of multiple factors to determine whether litigation was used as a means of securing undue benefits. Where a court declines to adopt a procuratorial supervisory recommendation in a malicious litigation case, the higher-level procuratorate, upon review and where appropriate conditions are met, shall file a protest to ensure effective supervision.
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