The Supreme People’s Court of China Confirmed the Importance of Trademark Registration in China

Authors: Mykolas Jakutis, an Assistant to Attorney-at-Law in METIDAReda Zaboliene, Managing Partner, Attorney-at-Law, Patent Attorney in METIDA

metida_antsoIn September of 2012, the Supreme People Court of China reversed the decisions of the lower instance courts and acknowledged that unregistered trademarks of Wing Wah Cake Shop Limited Company, such as  1(rong hua) and  2(rong hua yue bing) cannot be recognized as well-known trademarks.

Wing Wah Cake Shop Limited is a well-known owner of traditional Chinese confectionary shops established in 1950. The company uses unregistered trademarks  3(which means ‘prosperity’, ‘wellbeing’) and 4(which means ‘wellbeing’, ‘Chinese mooncakes’) for their mooncake labels. From 1960 to 1970, Wing Wah expanded its business to the US, the UK, Canada, Australia and south-east Asia. Wing Wah is distinguished for its popularity and possesses quite a few rewards for their production.

In 2006 Wing Wah Cake Shop Limited initiated a lawsuit before a court complaining about unfair competition actions and infringement of their trademark rights by Guangdong Shunde Sushi Ronghua Foods Factory. The court stated that trademarks of the company Wing Wah Cake Shop Limited are well-known and that opponent’s trademarks are confusingly similar to the former ones. Defendants made an appeal against this decision, however, the Court of Appeal made no changes regarding original decision apart from additionally constituting that only Wing Wah Mooncake 5trademark is well-known.

This decision was appealed against to the Supreme People’s Court which made a closure to this case. It was stated that plaintiff’s indicated trademarks cannot be recognized as well-known. Following this court’s decision the situation for Wing Wah is rather difficult and the disagreements between the companies are ongoing. Currently, Wing Wah is trying to register the aforementioned trademarks, however, earlier registered trademarks by Guangdong Shunde Sushi Ronghua Foods Factory hinders this due to the likelihood of confusion occurring between the trademarks. In response to this final court decision the defendant took savage actions and sent claims to 19 shops which belong to Wing Wah instigating suspension of goods labeled with unregistered trademarks.

It is worth noting that China applies ‘first-to-file’ rule in trademark registration order. Even though the rights of unregistered trademarks are acknowledged in China, the owner of this trademark must provide strong evidence that his/her trademark is well-known. Taking into account an aforementioned Supreme People’s Court decision, it is advised for the trademark proprietors to register their trademarks as soon as possible. As the earlier mentioned decision shows, it can be impossible to protect the rights to the unregistered trademarks. Claims can also be received from the proprietors of realistically later but earlier registered trademarks.

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