Chinese IP Law Updates
November 11, 2016

Adidas Succeeds in Trademark Infringement case Against Tmall Online Store and Receives Compensation of RMB 1.2 Million

Recently, Wenzhou Ouhai District Court held a public hearing, pertaining to the trademark infringement lawsuit between Adidas and Wenzhou XIAO JIN DAN Trading Co., Ltd (here in after referred as “XIAO JIN DAN”).

On September 15th, 2016, staffs from Adidas bought three pairs of shoes through a Tmall online store named “XIAO JIN DAN Flagship Store”.

They hold that these three pairs of shoes constitute the infringement of the exclusive right to use Adidas’s top 3 registered trademarks respectively. Adidas filed a lawsuit to Ouhai District Court on May 16th, 2016 and demanded that, (i) “XIAO JIN DAN” shall immediately cease and desist from producing and selling infringing products; (ii) “XIAO JINDAN” shall compensate Adidas for economic losses in the aggregate amount of RMB 3 million.

Adidas said, according to transaction records, it shows that the sales volume of involved products is extremely large. “XIAO JIN DAN” has sold over 150,000 pairs of infringing shoes since the first half year of 2015 and the sales amount is over RMB 10 million.

In court, “XIAO JIN DAN” claimed that, (i) the trademark of involved products is not identical or similar to the trademark of Adidas; (ii) it would not show any relevant information of their products while searching Adidas trademark online; (iii) it shall not cause confusion and misunderstanding among consumers. Therefore, it shall not constitute the infringement of the exclusive right to use a registered trademark of Adidas. They also claimed that the total sales amount is not consistent with the record showed on the webpage due to goods’ scalping and returning.

After hearing, the court holds that, (i) “XIAO JIN DAN” used trademark is too similar to the registered trademark of Adidas and it constitutes a trademark infringement; (ii) “XIAO JIN DAN” is an online store and their consumers are not bound by regional limitation; (iii) the trademark infringement was constituted for a long time and the total sales volume of involved products is over 100,000 pairs. Therefore, Ouhai District Court ruled that “XIAO JIN DAN” shall stop the trademark infringement immediately and compensate Adidas in the amount of RMB 1.2 million for economic losses.

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