OEM Trademark Infringement on “PEAK”
Recently, the Shanghai IP Court has issued a final judgment on the trademark dispute involving the Plaintiff Fujian Quanzhou Peak Sport Products Co. Limited (hereinafter referred to as “Peak Co.”) and the Defendants Issac Morris Ltd. plus its OEM manufacturer Wuxi Zhenyu International Trade Co.(“Zhenyu Co.”). Amending the prior judgment to rule the defendants’ contract manufacturing as contributory trademark infringement.
Facts:
Peak Co. is the owner of the trademark “PEAK and figure” in Class 25 “shoes, clothing”, which was determined as a well-known trademark by the Trademark Office of China’s State Administration of Industry and Commerce in 2009. As for Issac Morris Ltd., it was granted approval for registration of the trademark “PEAKSEASON” in the US on Nov. 2, 2010, whose description regarding the mark drawing goes “standard character mark typeset” (without specific typeface, font style, font size or color).
On Apr. 7, 2014, Issac Morris Ltd. ordered from Zhenyu Co.448 dozens of men knitted T-shirts with labels and tags printed with “PEAKSEASONNCAA”. The order was made at a unit price of FOB 28.80 US dollar, totaling US $12,902.40. Later, on Jun. 25, an email was sent from the former to the latter to request manufacture of the “PEAKSEASON” tags as in the attached design while the “NCAA” ones would be provided separately. Two months later on Aug. 20, the ordered products were seized by the Shanghai Customs when being exported, following the Peak Co.’s application for detainment and litigation preservation of the seizure.
Decisions:
The court on first instance ruled against Peak Co., pursuant to the territorial principle. It held that the involved trademark would not cause confusion to domestic Chinese consumers since the products were solely for overseas distribution, without plans of entering the Chinese market, despite its similarity to the Plaintiff’s mark.
However, Peak Co. disagreed and lodged an appeal. In second instance, it presented a decisive new exhibit, which revealed that a product link to the US Amazon would appear as the user keyed in “peakseason” on its Chinese website, which meant that the involved products were available to Chinese consumers through the US shopping platform. It was based on this fact that the court of second instance remedied the prior judgment and ruled that the two companies involved in OEM shall assume joint liability.
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