Haworth & Lexon IP Cases Report (8)

No.2, 2003 (Total:No.8) March 5th, 2003

"Haworth & Lexon Intellectual Property Law Newsletter" aims at introducing new cases and legal tendency in IP fields. All the comments do not mean the legal opinion of our firm and the firm does not have any legal liability for such comment. If you require any legal advice, we are willing to offer you considerate service. You can write E-mail to hl@hllawyers.com. If you have any interests and suggestions, or have any interests on some topics listed in this law newsletter, please contact with us.

Guidelines★ Haworth & Lexon was retained to lodge a lawsuit against the "NIPPON PAINT" trademark infringement and anti-unfair competition (passing off), and won the final trial★ The Dispute Case in "恒升" vs. "恒生" Regarding the Exclusive Right to Use the Trademark and Unfair Practice of Competition★ Shanghai XIN HU Electric Motor Factory Co, Ltd. Won the First Trial of the Lawsuit Against Shanghai XIN LU Electric Motor Co, Ltd.★ The First Case in China Regarding Database Infringement Reached its Final Decision★ The People's Insurance Company of China Won the First Trial in the Battle for its Domain Name, San Xiao Book Store Was Ruled to Repeal the Domain Name "PICC"★ NIKE, Inc. Won the Trial Regarding Trademark Infringement

Haworth & Lexon was Retained to Lodge a Lawsuit Against the "NIPPON PAINT" Trademark Infringement and Anti-unfair Competition (passing off), and Won the Final Trial

on Jan. 13, 2003, the case, in which Hong Kong Nipsea International Limited represented by our firm suing Wuhan Libang Paint Co. Ltd for trademark infringement and against unfair competition got its final decision from Hubei High People's Court.

The court held that the defendant must stop using "NIPPON" on its products, packaging, advertising materials and any other operation activities, destroy all the advertising materials and packaging with the trademark "NIPPON", and pay RMB 80,000 damages to the plaintiff.

Recently, "Economy and Law" in CCTV Channel 2 will make a special program on this case. If you wish to know the detailed schedule of the broadcast, please phone our firm, or visit CCTV's website http://www.cctv.com/program/jjyf/01/index.shtml

The First Judgment of the Dispute Case in "恒升" vs. "恒生" Regarding the Exclusive Right to Use the Trademark and Unfair Practice of Competition

The case Beijing Heng Sheng Fast Asia Electric Group vs. Beijing Heng Sheng Technology Development Co. & Beijing Jin Heng Sheng Technology Development Co. relating to infringement of exclusive right to use trademarks was decided by Beijing First Intermediate People's Court in Jan. 28, 2003, which ruled that the two defendants must stop infringing, must publish an apology and pay RMB 9,200,000 damages to the plaintiff for its economic loss.

The plaintiff was the owner of the trademark "恒升", and the other trademark "恒生" was used in both Heng Sheng Computer and the advertising materials of the products manufactured and distributed by the defendant, Beijing Jin Heng Sheng.Through comparing the two trademarks on pronunciation and characters, the court confirmed that "恒升" and "恒生" were identical trademarks, illustrated with the recognizing ability of ordinary consumers with average attention. Although the registration of "恒生" had been approved by State Trademark Bureau, in the civil lawsuit regarding infringement of the exclusive right to use trademark, the people's court had the power to decide independently, whether or not the registered trademark claimed by the plaintiff and the trademark used by the defendant were identical.

The relevant decision concerning whether the trademark could be approved by administrative authorities could not be regarded as the evidence in the lawsuit.

In addition, the court held that, the use of any right can not violate other person's lawful benefits and interests. Thus the trademark involved in conflicts with other prior rights was illegal. No matter whether it had been registered, there was no legal ground for any actors to use the trademark.

Concerning this case, the registration of the trademark "恒升" processed by the plaintiff was approved on Feb.20,1993. Therefore, in spite of the registration of Beijing Heng Sheng Technology Development Co. for the trademarks, such as "ASCEND 恒生", "恒生"in conjunction with logo and "恒生", the defendant could not use the exclusive right of the trademarks above as the reason for the defense, because all of these trademarks were similar to "恒升" registered and used prior.Early in 1999, the owner of "恒升" had raised objection to the defendant on the registration and use of trademark "恒生". At least, from then on, the defendant should recognize the possibility of infringement. However, because the defendant had never stopped registering, using, or promoting these trademarks involved in the case, the consequence must be born by the defendant. Besides, joint infringement was made, when Beijing Jin Heng Sheng Technology Development Co. was approved to use "恒生" by Beijing Heng Sheng Technology Development Co. Therefore, the court made the decision above.

Shanghai Xin Hu Electric Motor Factory Co, Ltd. Won the First Trial of the Lawsuit Against Shanghai Xin Lu Electric Motor Co, Ltd.

The plaintiff, Shanghai Xin Hu Electric Motor Factory Co, Ltd. alleged that, the trademark "XIN HU LONG" used by the defendant, Shanghai Xin Lu Electric Motor Co, Ltd. was similar enough to the plaintiff's registered trademark "XIN LU" to mislead consumers. In addition, the defendant used the same covers, colors, photos and illustrations as those of the plaintiff in its own instructions. On Nov. 27, 2001, the defendant registered the name "Shanghai Xin Lu Electric Motor Co, Ltd.", similar to the plaintiff's name "Shanghai Xin Hu Electric Motor Factory Co, Ltd." and its trademark "XIN LU". The defendant also followed the plaintiff in exploring new markets by setting up its distribution site near the plaintiff's in the markets as soon as the plaintiff explored them.

It was easy for consumers, confused by all the behaviors above, to mistake the defendant's "XIN LU LONG" water pumps for "XIN HU" or "XIN LU" water pumps produced by the plaintiff, and as a result, a big loss had been caused in the plaintiff's sale.

The court held that, there were sufficient legal grounds for the plaintiff to claim the exclusive right to use the trademarks "XIN HU" and "XIN LU", and the court held the unfair competition of the defendant was established. However, concerning the claim that the defendant must cease the use of its name, the court maintained that it was difficult to be supported, for the authority to approve the name of corporations was relevant administrative department of industry and commerce.

Therefore, the court decided that the defendant must stop the unfair competition and must pay RMB 100,000 damages.

The First Case in China Regarding Database Infringement Reached its Final Decision

Hainan Jing Tian Information Co, Ltd, the plaintiff, brought a lawsuit against Haikou Wang Wei Technology Co, Ltd. for database infringement. The case have reached the final decision, after it went throuth Haikou Intermediate People's Court and the appellate court, Hainan High People's Court. The infringement on the Database of Law and Regulations of China was held to be established and the defendant was ruled to cease the infringement immediately, and apologize in written form to Hainan Jing Tian Information Co, Ltd, and pay RMB 50,000 damades.

In the first trial, the court did not confirm the infringement. While in the second trial, the plaintiff presented on the court the source database, the defendant's database, and the database of someone out of the case.

The demonstration showed that, the defendant's database was as same as the plaintiff's in the aspects such as the division of laws, the coding of divisions, the format of editing the titles and the authorities which enacted the regulations, the format of omission and the edit of contents and notations, the style of edit, and even the faults in using and editing special symbols.

The appellate court confirmed the copyright of the Database of Law and Regulations of China, registered in 1998. Since the database of Wang Wei Co. was almost identical to Jing Tian's and only partly similar to the database of someone out of the case, the possibility of plagiary could not be denied. The defense of Wang Wei Co. could not make no legal sense.

Thus, the court held the infringement on the Database of Law and Regulations of China was established, and reversed the original judgment and supported the claim of the plaintiff.

The People's Insurance Company of China Won the First Trial in the Battle for its Domain Name, San Xiao Bookstore Was Ruled to Repeal the Domain Name "PICC"

The plaintiff in the case was The People's Insurance Company of China and the defendant was Beijing San Xiao Bookstore. The nature of the case was the controversy over ownership of domain name in computer network. Recently, Beijing Second Intermediate People's Court made the first trial, which ruled San Xiao Bookstore must repeal the domain name "PICC" in ten days.

The court held , as a domestic famous insurance company, which was known by the relevant public, the plaintiff possessed certain business reputation. "PICC", the abbreviation of the plaintiff's name in English, was also an evidently identifiable part of its registered trademark "保 PICC". Thus, the lawful benefits of the plaintiff on "PICC" should be protected.

The court also held that, in the environment of electronic business, domain names, as marks with identifiability, could bring relevant benefits to the owners. Therefore, domain names had the nature of civil benefits and interests.

"PICC", the part with identifiability of San Xiao Bookstore's domain name "picc.com.cn" was totally identical to "PICC" in the plaintiff's trademark "保 PICC". San Xiao Bookstore did not have any other prior right on the mainly identifiable part of its domain name and its registration was latter than the trademark "保 PICC" of the plaintiff. The explanation of the defendant, that "PICC" was the first four letters of "piccolo" meaning minitype, was too far-fetched to be the reasonable basis for registering and using this domain name.

The behavior of San Xiao Bookstore had not only misled the relevant public, and hindered the plaintiff to register its domain name with the abbreviation of its English name and the part with identifiability in its trademark, but also hindered the plaintiff to use this domain name in online business activities.

The court confirmed the unfair competition for the defendant had the subjective fault to breach the basic rule of fairness and goog faith. The court decided, the defendant must bear the relevant civil liablity.

NIKE, Inc. Won the Trial Regarding Trademark Infringement

U.S. NIKE, Inc. who discovered in its operation that, certain corporations in Spain and Zhejiang Province, China had violated its registered trademark, won the first trial after the loss in Spain.

The plaintiff, U.S. NIKE, Inc. was the owner of the patent of its registered trademark "耐克" (NIKE). The range of use regulated by No.146658 registered trademark was sportswear. In August, 2000, the plaintiff found that, authorized by a Spanish company, a certain clothing manufacturer in Jiaxing, Zhejing Province were producing ski suits with the trademark "耐克" (NIKE). After the finish of this batch of suits, this manufacturer authorized an imports and exports company in Zhejiang to act as the agent to apply to Shenzhen customs. Thus, the plaintiff held its exclusive right was infringed and brought a lawsuit to a court in Shenzhen, claiming the immediate stop of infringement, elimination of harm, apology and damages. The plaintiff had brought a lawsuit on this infringement in Spain, but found no support from the court.

Having verified the evidences, the court in Shenzhen confirmed that, as the legal person registered in U.S, the plaintiff was the owner of the exclusive right to use the registered trademark "耐克" (NIKE) in China. Once approved to be registered, "耐克" (NIKE) had been protected in the range regulated by the State Trademark Bureau. In spite that the Spanish company possessed the exclusive right to use the trademark in Spain, the court in China should protect, in the range of judicial power, the exclusive right of the plaintiff, as the regional intellectual property, and the defendant should not have used the trademark without the permission of the plaintiff.

In accordance with the Trademark Law of China, the first trial held that, the three defendants must cease the infringement immediately, destroy all the marks and products involved in the infringement, pay RMB 300,000 damages and bear the litigation cost.