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Cross-class Protection of Well-known Trademarks Should Match Their Reputation

Innovation leads development and protection of intellectual property rights is just protection of innovation. In 2020, China was ranked number one in the world for nine consecutive years in the quantity of invention patent applications and it was ranked number 14 in the Global Innovation Index with its 27.414 million pieces of effective trademark registrations up to the end of June 2020. In 2020, China further intensified IP protection and introduced the punitive compensation system to deter intentional IP infringement by increasing the cost of infringement.

In judicial practice, however, there exist disputes about how protection of well-known trademarks matches their reputation and to what extent they should be protected across classes. Here I would like to share my thought on cross-class protection of well-known trademarks through a case I have handled.

In June 2018, market monitor showed that a company by the name of Yaboo International Furniture Trading Center Ltd. (“Yaboo”) in Shenzhen, a major city in South China’s Guangdong Province, was heavily using the logos  and  in their Wechat official platform, PC APP, and posters, and even in exhibitions. See figure below.

Nestle believed that Yaboo infringed their exclusive right to their well-known trademarks “Nestle in Chinese characters” and “Nestle” with respect to “coffee” products in Class 30. In July 2018, Nestle brought legal proceedings before Guangzhou Intellectual Property Court, requesting the court to determine the trademarks “Nestle in Chinese characters” and “Nestle” with respect to “coffee” products as well-known ones and order that Yaboo stop its infringing act, be prohibited from using the infringing logos at issue in any sense of trademark, issue a statement in China Intellectual Property News to eliminate ill effects, and pay CNY 3 million (USD 462,000) in damages and the costs of trademark protection.

This case has 3 centers of dispute.

Dispute 1: Whether it is necessary to determine the trademarks “Nestle in Chinese characters” and “Nestle” as well-known

The court held that in spite of the fact that the plaintiff’s trademarks are registered with respect to “coffee” and “infant foods” and the defendant used them for the service of sale of“household goods”and there is a real difference between goods and services, the defendant had express bad faith in that it used the logos at issue in the full knowledge of the reputation of the plaintiff’s trademarks.  It is thus necessary to take account of the reputation of the plaintiff’s trademarks in this case to stop the defendant’s infringing act.

The court further held that the ample evidence Nestle presented in the case for the use of their marks during 2015-2017 is sufficient to prove that at the time of infringement the marks “Nestle in Chinese characters” and “Nestle” , with a long time of use and publicity, have had a great reputation, are generally known to the relevant section of public, and have achieved the status of well-known trademarks so as to be determined as well-known.

Disputes 2: Whether the use of the alleged infringing logos constitutes an infringement of the plaintiff’s exclusive right to their registered trademarks involved

The court held the alleged infringing logos constituted an imitation of Nestle’s well-known trademarks. Meanwhile, considering the high reputation of Nestle’s marks, the use of the alleged infringing logos for the services of wholesale and retail of household goods would “mislead the public and harm the interests of the well-known trademarks’ owner”. Therefore, Yaboo’s use of the infringing logos is an act of “causing other harms” to Nestle’s exclusive right to their registered trademarks.

Dispute 3: How the defendant shall accept its legal liability in the event of infringement

The court ruled that Yaboo should stop infringing act forthwith when the judgment is effective and pay Nestle CNY one million (USD 150,000) in damages within 10 days from the date when the judgment is effective.

After Guangzhou Intellectual Property Court passed the judgment of first instance, Yaboo was dissatisfied with it and appealed to Guangdong Provincial Higher People’s Court. In January 2021, Guangdong Provincial Higher People’s Court gave the judgment of second instance, dismissing Yaboo’s appeal and upholding the judgment of first instance.

The court of second instance ruled that Yaboo’s heavy use of the logos “ ”, “ ”, “Nestle Life in Chinese characters” and “Nestle Life in Chinese characters + Nestle” in their Wechat official platform and publicity campaigns and on the signboards of their chain stores was liable to mislead the relevant section of public into thinking its act was authorized by Nestle or it was associated somehow with Nestle, leading to confusion over the origin of the infringing goods or services, “the use of the infringing logos at issue tarnished the distinctiveness and goodwill of Nestle’s two registered trademarks as well-known ones and harmed Nestle’s interests,” and Yaboo had express bad faith as it continued using the infringing logos even after its application for registration of the mark “Nestle Life in Chinese characters” was refused.

Article 14 of the Trademark Law of the PRC: A well-known trademark, at the parties’ request, should be determined as a fact that needs to be ascertained in the handling of a case involving the mark. Account shall be taken of the following factors in determination of a well-known mark: (l) reputation of the mark to the relevant public;(2) the duration in which the mark is used; (3) the duration, extent and geographical area in which the mark is promoted; (4) the record of protection of the mark as a well-known one; and (5) any other factors relevant to the well-known reputation of the mark.

In hearing cases of trademark infringement, the determination of well-known status of the mark(s) concerned is necessary when the general rules do not work. Only by determining the mark(s) as well-known can cross-class protection of well-known trademarks be provided under the trademark law. “Cross-class protection” means the scope of protection goes beyond elimination of “the likelihood of confusion”. From the angle of legislation, cross-class protection should be limited to a proper extent. It cannot cover all fields; instead, it should be applied on the grounds that confusion among consumers over the supplier and origin of goods or services is created or some association is formed. In trying cases of this kind, the court should consider the reputation and distinctiveness of the trademark(s) concerned and the misleading effect of infringing act. At the same time, in defending their right, the trademark owner should provide evidence for his/her trademark(s)’s reputation and well-known status. In the event of significantly different classes of goods or services, the trademark owner must convince the judge by sound, persuasive and logical arguments that the defendant has bad faith subjectively and the infringing act is liable to cause “confusion” over the origin of goods or services among the public objectively so much as that relation between the trademark(s) and its (their) owner are weakened or diluted and then the reputation and goodwill of the trademark(s) are damaged, thus enhancing the chances of winning the case and protecting his/her IP rights and interests.

Résumés

Mr. Zhenkun Fu

Senior Partner; Trademark & Litigation Attorney

Zhenkun is a leading intellectual property law practitioner with more than 20 years’ experience in prosecuting trademark and patent infringement, unfair competition, and anti-counterfeiting cases. His work with Fortune 500 companies has resulted in the recovery of millions of dollars in damages. As a leading IP litigator, having managed thousands of lawsuits, Zhenkun’s groundwork and strategic insight, coupled with his exceptional relationships with AIC, BQS and PSB at national and local levels, makes him a key leader in intellectual property enforcement in China.

 

 

 

New Procedures at the UAE Trademarks Office

The Ministry of Economy in the UAE has recently issued circulars that are aimed at easing some of the formal requirements for trademark registration and some changes to the services being offered. This is a very welcomed step that will help all applicants, especially with the ongoing restrictions across the world due to the pandemic.

Following are the main changes:

Legalised Power of Attorney is no longer required at the time of filing

Previously, a UAE trademark application could not be filed unless it was supported with a duly legalised Power of Attorney, if issued outside the UAE. This has always created issues, as the legalisation process can take time to be progressed.

In April 2021, the UAE Trademarks Office adopted the practise of allowing trademark applications to be filed without a Power of Attorney, with an undertaking that the legalised Power of Attorney will be submitted within 30 days.

On June 3, 2021, the Ministry issued another circular stating that it will no longer accept a 30-day undertaking and a copy of the signed Power of Attorney, and its translation should be submitted  with the application. The legalised Power of Attorney needs to be submitted within 30 days of submission of the application. If the legalised Power of Attorney is not submitted within the stipulated period, the application will be rejected.

While the procedures have been eased, it is recommended to file the application together with the legalised power of attorney to avoid cancellation of the application. , should the power of attorney legalisation was delayed for whatever reason.

This procedure only applies to trademark applications and not third party oppositions, trademark renewals or recordals of assignments, licenses and change of owner details.

Priority Trademark Applications can be filed without a priority document

The UAE Trademark Office has further relaxed on the procedures for priority applications (effective 11 April 2021).  The right of priority under the Paris Convention provides that, on the basis of a trademark application filed in one of the countries in the Paris Union, the applicant may, within six months of that filing, apply for protection in any of the other countries in the Union.

The requirements of the UAE Trademark Office were that a copy of the trademark application, on which priority was being claimed, had to be filed with the initial UAE application.  Now with the more relaxed rules, a copy of the priority application can be submitted within three months of filing the trademark application.

Additional publications of the UAE Trademark Journal

As of 15th June 2021 the UAE Trademark Office will publish the Trademark Journal twice a month i.e. on the 15th and 30th of every month.  The Journal was a monthly publication which has been changed to manage the volume of trademarks in the UAE.  It is a welcome change as the bi-monthly publications will help reduce the time taken to obtain registration of a trademark.

With the largest and most comprehensive Intellectual Property practice in the region, our specialised trademark lawyers are available to support on every aspect of trademark registration and protection.

Santiago R. O’Conor joins Leaders in Law as the exclusive Trademark Law member in Argentina

Leaders in Law, the leading platform in its field, is delighted to welcome Santiago R. O’Conor as our exclusively recommended & endorsed Trademark Law expert in Argentina. Santiago’s office is located in Buenos Aires.

Santiago R O’Conor is the managing partner of O’Conor & Power Abogados-Propiedad Industrial, a solid and reliable team of IP practitioners based in Buenos Aires, Argentina. Mr O’Conor specialises in all aspects of intellectual property, principally trademarks, advising domestic and foreign companies on local and international IP law, prosecution and litigation in Argentina and Latin America.

Mr O’Conor professional IP experience spans over 36 years and includes being an associate of the largest worldwide law office, and Partner and Head of the International Trademark practice of the most important law office in Argentina for 23 years. The expertise he has gained over this long career has made Mr O’Conor the beloved darling of many international brand owners.

If you require any assistance in this area, please use the contact details provided in Santiago’s profile below or contact us at info@leaders-in-law.com & we will put you in touch.

Use of Trademarks in the U.S.

As North America brings its intellectual property laws in line with the United States-Mexico-Canada Agreement (USMCA), the way trademarks are handled in Mexico and Canada has recently changed. While Mexico now requires a business to use its mark to obtain a Mexican trademark registration, Canada no longer requires the use of a mark in order to obtain a Canadian trademark registration.

A business may spend significant resources attempting to use a trademark in the U.S., but ultimately fail to satisfy legal and technical requirements. Not only are such attempts wasteful, but they may also pose an obstacle to pursuing an otherwise legitimate trademark registration. To successfully register a trademark in the U.S., a business is required to use the trademark on or in connection with its products and/or services, but the law has different requirements for each.

U.S. TRADEMARKS FOR PRODUCTS

For a trademark associated with products, advertising alone, such as use in a brochure or on a website, is not normally enough. The mark must be placed in any manner on the products or on the containers of the products, or on tags or labels affixed to the products. If the nature of the products makes such placement impracticable, then it may be acceptable for the mark to be used on displays associated with the sales of the products. Additionally, the products must be sold or transported in interstate commerce.

The simplest way to satisfy this requirement is to put the trademark directly on the products, such as by incorporating the mark into the mold of molded products, stamping or printing the mark onto the products, or applying a tag or label to the products carrying the mark. The mark could also be applied to the packaging or container of the products.

For an example of displays associated with the sales of a product, the mark can appear with the product in a catalog or on a website, but there are specific requirements for those uses. If used in a catalog, the mark must be accompanied by a description or picture of the product, and the same catalog page generally must include ordering information such as a phone number or a web address. If used on a website, the mark must still be accompanied by a description or picture of the product, and the webpage must include the direct ability to order the product, such as a “Buy Now” or “Add to Cart” button on the webpage.

U.S. TRADEMARKS FOR SERVICES

For a trademark associated with services, the mark must be used or displayed in the sale or advertising of the services, and the services must be rendered in interstate commerce. That is, the services must be rendered in more than one state, or in some other way in interstate commerce, or in the U.S. and a foreign country, and the company rendering the services is engaged in commerce in connection with the services.

ENSURING CORRECT U.S. TRADEMARK USE: THE ABCD TEST

To ensure that your trademarks, aside from being placed on the products or used in connection with the sale of services, are being used correctly, use this ABCD test:

  1. Adjective: Use the trademark in the position of an adjective describing the product, followed by the common descriptive noun for the product. For example, use “KLEENEX tissue” not simply “a KLEENEX,” or “XEROX photocopier” rather than simply “the XEROX.”
  2. Brand identification: Properly identify the status of the trademark as a brand with the appropriate trademark symbol e.g., ® for a registered mark and ™ for a mark not yet registered.
  3. Consistency: Be strictly consistent in displaying the mark. If the trademark is punctuated, capitalized or colored in a certain way, it is critical to maintain the same formatting. Any change of any of those properties could be considered a change to the mark, that is, adopting a different mark. Such consistency will also help ensure that others recognize that this is a trademark and not just another word. While it makes sense for a company to adopt a different mark from time-to-time, such changes should only be done intentionally, after careful thought and transition planning, rather than by accident or in a casual attempt at creativity.
  4. Distinctive: Use the mark in a way that is distinctive, that sets it off from surrounding text, such as in a different typeface, color or capitalization
Article by;

Nicholas A. Kees
Alexander C. Lemke
Godfrey & Kahn S.C.

IP Introduces Fast Track Trademark Registration and Renewal

On 23 February 2021, the Department of Intellectual Property issued a Notification introducing a fast track examination process for trademark registration and renewal. This notification is issued with the aim of expediting trademark registrations and the renewal process, thus enhancing and facilitating trademark protection for both the private sector and general public; enabling them to build a conductive business operation.

For the fast track trademark registration, an application for trademark registration will be examined within six months from the filing date, although the publication period and grant of the registration certificate may not be completed in said six-month period. The trademark application eligible for the fast track process must comply with the following conditions:

  • The lists of goods/services must not exceed 30 items.
  • The specifications of goods/services must all conform to the recommended acceptable specifications of the Department of Intellectual Property.

For the fast track trademark renewal, each application will be examined within 45 minutes from the time of submission. The renewal application eligible for fast track renewal must meet the following conditions:

  • The lists of goods/services under the trademark registration must not exceed 30 items.
  • There must be no amendments to the specifications of goods/services under the trademark registration.
  • The renewal application must be submitted at the Department of Intellectual Property, Ministry of Commerce, by the trademark owner or appointed agent. In the latter case, the power of attorney must state that the appointed agent has the authority to receive a certificate of registration.
  • The applicant or appointed agent must request at the time of submission that he/she would like the Trademark Registrar to urgently examine the renewal application and issue the certificate of trademark registration renewal.
  • The official renewal fees must be fully paid. In the event that the renewal application is defective but possible to be corrected within the date of submission of the renewal application, the Registrar shall order the amendment and accordingly grant permission for trademark registration renewal on the date of submission of the renewal application. However, if the application cannot be resolved by the date of submission of the renewal application, the Registrar shall examine the renewal application within the period specified in the public manual (normal process), according to the Licensing Facilitation Act B.E. 2558 (2015).

Please note that this Notification applies to all types of marks, i.e. trademark, service mark, certification mark, and collective mark.

Trademark Protection for Product Shapes and Containers

American law has long granted trademark protection to the shapes of products and containers. Perhaps the most famous example is the instantly recognizable Coca-Cola bottle, which is almost as important a trademark as the soft drink company’s stylized name logo (Trademark protection for the product shapes and containers should not be confused with the safeguards afforded by design patents).

But in one case, actions taken by two well-known companies brought the concept of product shapes into the headlines.

Zippo Manufacturing Co. announced that it received trademark protection for its cigarette lighters’ distinctive rectangular shape in late 2002. The Pennsylvania manufacturer informed wholesalers and retailers that it intends to take action against merchants found selling lighters designed to mislead consumers by infringing on Zippo’s trademarked shape. The company contends that its authorized distributors and retailers have lost millions of dollars in profits over the years as a result of the sale of copycat products. It demanded that all infringing merchandise be removed from store shelves.

In another claim of trademark protection for a distinctively-shaped product, General Motors Corporation recently filed suit against Avanti Motor Corp., claiming that Avanti’s Studebaker XUV infringes on the distinctive shape of GM’s popular Hummer H2. GM argues that consumers will be confused by the similarity of the design of the two vehicles in violation of trademark law. Avanti responded that the design of the XUV is clearly distinct from that of the H2 and therefore causes no confusion among the buying public.

Traditionally, trademark protection is granted only to products or containers with a shape that is easily recognized by the public. In legal language, a trademark exists if the shape has developed a “secondary meaning” indicating it is associated with the company of origin. Although the above examples might seem to indicate that trademark protection only exists for well-known products or containers that have been around for an extended period of time, business owners should be aware that protection is becoming easier to obtain. Today, a distinctive shape may be seen as worthy of trademark protection after a short period of time on the market.

The implications of trademark law for container and product shapes affect businesses across all sectors of the economy. While manufacturers are protected against copying of their products and containers’ shapes, businesses must also be careful not to copy the design of a competitor’s product. In addition to manufacturers, merchants can be held liable for significant damages for selling merchandise that infringes on another company’s trademark.

Design Patents vs. Trademark

Although product shapes and containers are eligible for protection under trademark law, they may also be protected by a design patent as well. Not surprisingly, the coverage afforded by design patents differs from that provided by trademark law.

Design patents prohibit a third party from making, selling or using a product that infringes on a patented design. There is no requirement that companies show a product or container’s content is in any way similar to that of the protected design. Under trademark law, however, it is necessary to show that the infringing product or container could be confused with that of the company seeking the protection of the law. The buying habits of consumers are crucial in proving trademark infringement occurred.

William H. Shawn Co-Managing Partner, ShawnCoulson

Update of the Romanian Trademark Law

With a delay that nearly triggered sanctions from the European Court of Justice at the request of the European Commission, Romanian legislative body fulfilled its obligation to implement the EU Directive for approximation of the trademark laws in the Member States; the law came into effect in July.

The new law includes important changes based on the directive, inter alia:

  • the definition of trademarks has been updated for the “digital age”,
  • among other clarifications and simplifications of the registration procedure, some terms have been shortened,
  • extent of trademark protection depends on description of goods/ services,
  • counterfeit goods, found on Romanian territory in transit, are now subject to possible sanctions,
  • new legal remedies on cancelation of trademarks,
  • updated list of reasons for rejecting requests for trademark registration and so on.

The directive is aimed at the modernization of the trademark law EU-wide; with its implementation, the Romanian legislation is brought to the required level. The new law introduces a more efficient registration procedure, shorter periods and extended contestation options, which overall increases the protection for existing and future trademarks. Corresponding procedure rules should also be implemented in the near future.

More information in the link below:

https://stalfort.ro/wp-content/uploads/2020/10/20201005_MM_Update_of_the_Romanian_trademark_law_MM.pdf

Trade Marks, Designs & Copyright: IP Review

Welcome to our Annual Review of developments relating to trade marks, copyright and designs during 2019. We have selected a number of the reports that we have published over the course of the last 12 months, commenting on issues ranging from the latest guidance on the boundaries of trade marks and designs through to a number of interesting questions on copyright protection in the light of developing technology and business models. This year’s Review mentions a couple of cases in which we acted, including in a website blocking action for Nintendo in relation to sites selling devices seeking to circumvent encryption measures, and an important case for Sky in the European Court of Justice relating to trade marks.

We also include a brief update on the Brexit position. Now that the Withdrawal Agreement has been ratified and the UK has left the EU, we are in the transition period. During this period, which will end on 31 December 2020 (unless it is extended, albeit the UK Government has said this will not happen), the status quo will be preserved. There will be no change in how IP rights will be protected and enforced during the transition period and, more specifically, EU Trade Marks and Designs will continue during the transition period to extend to the UK. As part of our Brexit preparations, we have set up Mishcon de Reya IP B.V., a trade mark practice based in The Netherlands. Mishcon de Reya IP B.V. is a wholly owned subsidiary of Mishcon de Reya LLP and will allow us to ensure continued representation in relation to EU Trade Mark and Design matters before the EUIPO following the end of the transition period. We will continue to update you on Brexit developments throughout the year.

Click here to view the pdf version of our Review.

We hope you enjoy reading the Annual Review. Please get in touch if you have comments or queries on any of the topics raised.

Trade Marks

Compared to previous years, trade mark law and practice in 2019 focussed to a much lesser extent on questions of infringement and enforcement. Instead, the key cases raised questions relating to clarity and precision of trade mark specifications (and whether this can be a ground of invalidity of a registered mark), and alleged bad faith during the trade mark application process. […read more]

Copyright

In a continuing trend, 2019 saw the CJEU issue a series of decisions following referrals from Member State national courts on various issues under the Copyright Directive and related Directives. This looks set to continue in 2020 with the CJEU due to hear more copyright referrals. […read more]

Design

Alongside an important referral to the CJEU relating to ‘first disclosure’ for Unregistered Community Designs, the implications of the Supreme Court’s Trunki decision continue to be felt in the UK Courts. […read more]

Brexit

The UK left the EU on 31 January 2020.  The EU and UK reached a revised Withdrawal Agreement which includes a transition period ending on 31 December 2020.  During the transition period, the status quo continues to apply in relation to IP rights, with EU trade marks and designs continuing to extend to the UK. […read more]

Other developments

Other interesting developments over the last year relate to competition law considerations in relation to brands and online marketplaces.