People’s High Court of Beijing, Administrative Judgment ( No. 1118(2010))

October 18, 2010

Summary:

Shanxi Xinghuacun, Inc. (Appellant, hereinafter referred to as “Shanxi” ), dissatisfied with the judgment made by No. 1 People’s Intermediate Court of Beijing (“Beijing No. 1 intermediate Court”) on the trademark opposition decision made by the Trademark Review and Adjudication Board (Appellee, “TRAB”), filed an appeal in the People's High Court of Beijing ( “Beijing High Court”).

Shanxi alleges that the trademark “杏花村” (“Xinghuacun” in Chinese characters) that Anhui Xinghuacun, inc. (“Anhui”) seeks to register for goods such as “trees, cereals” in class 31 of the Nice Classification damages Shanxi’s well known trademark  “杏花村”, a priorly-registered mark for goods of “alcoholic beverages” in class 33; and claims that the decision made by TRAB and the judgment made by Beijing No. 1 intermediate Court, which decline to give the well-known trademark “杏花村” cross-classification protection, violate the Trademark Law and relevant judicial interpretation. 

Beijing High Court ruled that the protection of a well-known trademark is not necessarily extended to all classes of Nice Classification, and thereupon made the final judgment dismissing the appeal of Shanxi on the ground that the argument and request of Shanxi are unfounded.

Facts:

Shanxi owns the trademark “杏花村” registered for “alcoholic beverages” in class 33 of  the Nice Classification. The trademark has been recognized as a well-known trademark by the Trademark Office.

On February 28, 2002, Anhui filed an application for registering a trademark “杏花村” (trademark No. 3102476) for goods such as “trees, cereals, plant germchits, live animals, fresh fruits, fresh vegetables, plant seeds, feedstuff, distiller's malts, plants” in class 31. The application passed the preliminary examination and was published for opposition. Shanxi filed an opposition against the published trademark (hereinafter referred to as “the opposed mark” ). Upon reviewing, the Trademark Office made a decision of dismissing the opposition and approving the registration of the opposed mark .

Shanxi did not accept the decision and appealed to TRAB. On January 11, 2010,  TRAB refused the registration of the opposed mark for “distiller's malts”, while approving the registration for other goods.

Shanxi, dissatisfied with the TRAB’s decision, started the legal proceeding at Beijing No. 1 Intermediate Court.

Beijing No. 1 Intermediate Court, based on Article 13, Paragraph 2 of the PRC Trademark Law, held that factors, such as reputation and originality of the trademark cited for opposition (hereinafter referred to as “cited mark”) as well as the relevancy between the goods respectively identified for the opposed mark and the cited mark, shall be taken into consideration in determining the possibility of misleading. According to the court, although the cited mark “杏花村” of Shanxi has been recognized as a well-known trademark for liquors, the cited mark as a term was not originally created by Shanxi itself. The goods identified for the cited mark are different (with respect to manufacturing, marketing channel, and target consumers) from goods (such as “trees and cereals”) identified for the opposed mark. The registration and use of the opposed mark on goods such as “trees and cereals” are not likely to mislead consumers and thus are not likely to violate the rights and damage the interests of Shanxi. Consequently, the registration of the opposed mark for goods such as “trees and cereals” does not violate Article 13, Paragraph 2 of the Trademark Law. Accordingly, Beijing No. 1 Intermediate Court affirmed the decision of TRAB.

Shanxi did not accept Beijing No. 1 intermediate Court’s judgment and appealed to Beijing High Court.

Issues:

What is the reasonable definition for the protection scope of a well-known trademark; what is the proper protection scope for a trademark extracted from the public domain. 

Applicable law:

Article 13, Paragraph 2 of the Trademark Law provides, “If a trademark, for which an application for registration is filed, of a different or dissimilar commodity is the copy, imitation or translation of a well-known trademark of others which has been registered in China, and misleads the public and leads to possible damage to the interests of the registrant of that well-known trademark, it shall not be registered and shall be prohibited from use.”

According to article 10 of the “Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law to the Trial of Cases of Civil Disputes over the Protection of Famous Trademarks”, if the plaintiff files a motion to enjoin the defendant from using the trademark, which is identical with or similar to its famous registered trademark, or enterprise name on dissimilar commodities, the people’s court shall, in light of the concrete circumstance of the case, make a ruling after comprehensively taking into account the following factors …”

Holding:

Appeal dismissed;

Beijing No. 1 Intermediate Court’s judgment affirmed.

Reasoning:

Beijing High Court held:

The protection scope of a registered trademark closely relates to the reputation and distinctiveness of the trademark. If a trademark is well-known to the public, it surely has strong distinctiveness. In such a case, the originality of a well-known trademark does not noticeably affect the protection scope of the trademark. The decision of TRAB and the judgment of Beijing No. 1 Intermediate Court, though taking the originality of the trademark as one factor, do not treat it as the dominant factor to determine whether the opposed mark misleads the public and thus leads to possible damage to the owner of the well-known trademark; TRAB and Beijing No. 1 intermediate Court weighed the factor of originality along with other factors, such as reputation and relevancy between the goods respectively identified for the opposed mark and the cited mark. The allegation of Shanxi that No. 1 Intermediate Court merely focused on the originality of the trademark when determining the “misleading” and “damage” of the trademark is unfounded.

The association of   “杏花村” with liquors did not start with use and promotion of the cited mark by Shanxi, it originated from the poem of Dumu in Tang Dynasty. Shanxi built up the cited mark into a well-known trademark for liquors, especially for Fen liquor. Consequently, the protection of the well-known trademark shall not prohibit others from using public domain resources (such as the poem of Dumu) to establish their own brands if the use does not damage the cited mark and thus does not violate the rights or harm the interests of Shanxi.

The registration and use of the opposed mark in goods such as “trees and cereals” by Anhui is not likely to mislead the public into associating the opposed mark with the cited mark, which results in diluting the distinctiveness and damaging the reputation of the cited mark. It is appropriate for TRAB and Beijing No. 1 Intermediate Court to rule that the registration of the opposed mark is not likely to mislead the public and thus is not like to violate the legitimate rights or damage the interests of Shanxi.