Chinese IP Law Updates
July 30, 2021

Cross-class protection for well-known trademarks against registered trademarks

Cross-class protection for well-known trademarks against registered trademarks

SOUTHCORP BRANDS PTY LIMITED, Plaintiff, is the owner of the registered trademark “Penfolds” and its corresponding Chinese trademark designated for use under the good “wine” in class 33. In April 2019, the Plaintiff discovered that a company in Zhuhai (hereinafter referred to as the “Defendant”) was displaying and selling blenders and cooking machines named “Penfolds” (hereinafter referred to as the “Infringing mark”) at the China Import and Export Fair, and the Infringing mark “Penfolds” was almost identical to the Plaintiff’s trademark “Penfolds”.

Furthermore, Plaintiff found that Defendant and its related companies were manufacturers mainly engaged in the export business of small household appliances, and in addition to copying Plaintiff’s registered trademark “Penfolds”, they also had several associated companies whose names contained the Chinese trademark. However, Plaintiff further discovered that one of Defendant’s associated companies had applied for a trademark “Penfolds” in black-and-white in 2008 for goods such as cooking machines in class 7, which has been approved for registration for more than ten years.

In October 2019, the Plaintiff filed a lawsuit with the Guangzhou Intellectual Property Court, requesting the Court to determine that the trademark “Penfolds” designated under the good “wine” in class 33 should be recognized as a well-known trademark and to order the defendant to immediately stop its infringement and compensate the Plaintiff for the corresponding economic losses. This case is a typical example of cross-class protection for well-known trademarks against registered trademarks, which is of great significance both in judicial practice and for the protection of intellectual property rights by right holders.

  1. Following the relevant judicial interpretation, for infringing registered trademarks that imitate well-known trademarks, the Court shall rule that the defendant should stop infringing, except when the allegedly infringing trademark has been registered for five years or when the Plaintiff’s trademark was not deemed as a well-known trademark at the time of the application of the infringing trademark. In this case, the Infringing mark was applied for in 2008 and the registration was approved over five years ago, also the Plaintiff’s trademark “Penfolds” may not have reached well-known status before the date of application for the Infringing mark. Thereupon, Plaintiff argued that the Infringing mark actually used by Defendant was in the same color and almost identical style as the Plaintiff’s trademark “Penfolds”, and was not a standardized use of its black-and-white “Penfolds” trademark registered in class 7, which prompted the Court to rule that the time point for determining the Plaintiff’s trademark as a well-known mark was in 2019 when the infringement occurred rather than when the Infringing mark was applied for. And thus, the trademark “Penfolds” registered by Plaintiff successfully was recognized as the well-known trademark.
  2. Also, the Court found that the Plaintiff’s trademark “Penfolds” is a well-known trademark based on several factors such as Plaintiff’s evidence of popularity, the degree of public awareness of the Plaintiff’s trademark “Penfolds”, the duration of use of the trademark “Penfolds”, the duration, extent and geographical scope of publicity and promotion the trademark “Penfolds”, and the record of protection of the trademark over the years.
  3. Regarding the difference between the Infringing mark and the Plaintiff’s trademark in designated class and goods, and the similarity between the Infringing mark and the Plaintiff’s trademark in sales targets, the Court adopted the Plaintiff’s opinion and found that the Defendant did constitute trademark infringement. In addition, even though China’s Trademark Law does not expressly provide the liability for the infringement of a well-known trademark by a registered trademark, the Court ordered the defendant RMB 250,000 in damages for the Plaintiff’s economic loss.