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China Trademarks — Do You Feel Lucky? Do You?

Posted in Legal News

Our advice to all our clients is to register their trademarks in China before they go there.

China is a first to register country, which means that whoever registers the trademark first gets it.

Yes, there is an exception for famous trademarks, but unless you are Coca-Cola, it is lunacy to bank on a Chinese court holding your trademark is famous when just going ahead and registering it costs so little. Most firms charge less than $5,000 for this. So even if the Chinese Court rules your trademark is famous, you will probably have spent at least $100,000 in making your case. The economics just are not there.

Ferrari, the famous Italian car manufacturer, just proved our point.

In Ferrari is Famous, But Is the Horse Too?, China Business Law Blog wrote on how Ferrari lost its ability to use its famous (but not famous in China) horse logo in China. The post relates how after more then ten years of legal wrangling (anyone think that cost less than $100,000?), the Beijing First Intermediate Court ruled that Ferrari’s horse is not famous enough in China to be considered a famous trademark.

In 1996, White Clouds Sports Merchandise filed for trademark protection of a horse logo to go with a clothing line. Ferrari filed a timely opposition to this registration, claiming that granting White Clouds the trademark would confuse consumers. “The Chinese Trademark Office did not buy Ferrari’s argument, citing that White Clouds registered the graphic of the horse first.”

Undaunted, Ferrari appealed to China’s trademark review board, claiming “both the Ferrari with the horse graphic trademark and the horse graphic alone constituted famous trademarks.” The review board denied Ferrari’s appeal and Ferrari then took its case to court.
Before the court, Ferrari again claimed that the graphic of the horse is closely tied to the Ferrari mark, and it should be considered a famous trademark because the Ferrari trademark has become well known around the world, including in China. The court rejected Ferrari’s claim for the following three reasons:

  • Ferrari failed to provide sufficient evidence regarding its use of the horse logo in China.
  • China has a system for recognition of famous trademarks. Recognition of the name “Ferrari” as a famous trademark does not constitute recognition of the Ferrari horse graphic.
  • The issue in the case is the horse logo, not the Ferrari trade-name. The horse cannot be bootstrapped to the Ferrari trademark for similar protection.

China Business Law Blog concludes its post with some good advice:

After more than ten years of trekking in the Chinese legal system, Ferrari got a disappointing verdict. Hopefully, Ferrari got something else too: a lesson to register its trademarks, [and] related trademarks as early as possible.

Or, as my friend Dan Hull, over at the perennially enlightening What About Clients, puts it, Dude, register your IP in China.

For more on registering your trademarks in China, check out this article I wrote for ALM’s China Trade Law Report, entitled, China’s Trademark Laws – Simple and Effective.

Or do you feel lucky?

  • Todd

    Let me get this right: A blog named China Law Blog is plugging a blog named China Business Law Blog – concerning a case of intellectual property.
    Copycats writing about copycats – amusing!

  • http://www.chinalawblog.com China Law Blog

    Chris D-E –
    I am not at convinced it was an outrageous decision, but, fortunately, all companies need to do to avoid such decisions in the future is to register.

  • http://www.chinalawblog.com China Law Blog

    I suggest you get your facts straight before making accusations. This blog has been around for more than a year and a half and the China Business Law Blog has been around only for a few months, so it is bizarre for you to accuse this blog of taking the name.
    Seeing as how there are only so many words that can be used to describe a blog on Chinese law, I do NOT have any problem with the name of the Chinese Business Law Blog.

  • Law Office of Todd L. Platek

    For the record, “Todd” hereinabove with his copycat comment is not Todd Platek, and is not copycatting “Todd Platek,” who denies any agreement with said Todd’s allegation. Todd L. Platek, however, reserves all rights to “Todd Platek”, and any other “Todd” has no IP rights in “Todd Platek” whatsoever. I might register the name a.s.a.p. in China so I don’t have to sue said Todd or any other “Todd”s parading as “Todd Platek”, or seeking to confuse the US/China legal and commercial world with comments God forbid attributable to Todd Platek. I will protect my brand, caveat Todd.

  • http://www.redkemp.com RedKemp

    And just to back you up against fake Todd, I count 15 blogs in your bloglist that begin with “China”. It only makes sense to name your blog using words that describe what it is about. That way you know what you are going to see before you go there.
    Also, is there anyway to find out what companies have already registered their trademarks and which haven’t? In other words can I steal Ford’s logo in China for my company?

  • Todd

    China Law Blog -
    I appear to have been doubly misunderstood.
    First, my original comment was meant to point out that the China Business Law Blog was effectively copying China Law Blog (not the other way around). That you would even bother acknowledging these guys shows something – a bit of spirit on your part perhaps.
    Second, no reference was meant to any other Todd here. Should have used a pseudonym. Will do so in future.
    Todd (a different one)

  • ToddPlatekWannabe

    Dear Todd Platek.
    I just registered Todd Platek 13 minutes ago, and in the process of registering Todd L. Platek and Todd L. Platek Platek Platek.
    I will allow you to use my Trademark for the next 48 hours, after which my lawyers of China Law Blogg and China Law-Blog will take action accordingly.
    Best regards,
    Todd Platek [tm], AKA Zhang Tin Qin [tm]

  • Law Office of Todd L. Platek

    Tell it to the judge.

  • john troll

    Your advice to always register before going to China makes sense for the average brand owner but may be misleading for the owner of a well known brand- with world wide, regional or national reputation that may have existed for many years. The process for establishing one’s brand as well known occurs, in large measure, outside the registration context. Under the latest regulations there is no mechanism for a brand owner to apply for recognition of its well known status; rather the 2003 trademark Stipulations allow for 3 ways and 3 institutions to recognize well known trademarks. In a nutshell the brand owner seeks recognition based on an opposition proceeding, a cancellation proceeding or an infringement action- withut regard to whether one’s mark is registered.
    As for the decision itself- it appears to be as well reasoned as a decision one might find in any sophisticated jurisdiction.

  • http://www.chinabusinesslaw.blogspot.com Brad Luo

    Todd:
    I’m shocked by your accusation that “China Business Law Blog was effectively copying China Law Blog.” The hallmark of an infringement case is confusion, and I’d like you to education me how confusion arises out these two blogs.
    If you are a lawyer, I suggest that you read 420 F.3d 309 (4th Cir. 2005), which has an on point analysis relative to your accusation above. After reading that, please email me, leave a comment here, or on my blog, as I would like to know any confusion, either actual or possible.
    If you are not a lawyer, please note that a valid infringement claim typically must satisfy two basic requirements: 1). the accuser (plaintiff) must have a valid regime of IP; 2). the accuser must establish confusion. I’m not a lawyer, yet, and I don’t claim to be an expert on IP law, but you will have a hard time establishing confusion. That failure will be fatal to your claim, and the defendant will probably move to sanction you for frivolous pleadings under federal rule 12.
    I have been a loyal reader of China Law Blog for a while,and the last thing I want to do is to “copy” from CLB, thus engaging in self-destruction.
    Are there things that I want to imitate from CLB? You bet!! As a future lawyer, I covet Dan’s keen sense of legal issues that underlie disputes, his accurate assessment of facts and analysis thereof, and his clear and concise writing style. These are the basic skills that a lawyer should have.
    Copying and infringement of CLB? Absolute not!
    Mr. Harris, thanks for setting the record straight.

  • http://www.chinabusinesslaw.blogspot.com Brad Luo

    Chris:
    I respectfully disagree with you that the Ferrari decision is “outrageous.”
    What Ferrari wanted is protection under a “famous trademark” status. Even the law of the United States has reservations about granting overbroad trademark protectation b/c of concerns about anticompetition effects of such sweeping trademark rights.
    Section 43(c) of the Trademark Act was amended in 2005 to clarify the standard for “famousness.” 15 U.S.C. 1125(c). A mark is famous if “it is widely recognized by the general consuming public of the United States as a designation of source…” Three factors must be considered in determining whether a mark is famous. 43(c)(2).
    The Ferrari Court basically took the same approach in determining the “famousness” of the “horse” symbol. Regardless of the result of the case, the method and depth of the legal analysis is anything but “outrageous.” Given the facts, I think the Court got it right. Average Chinese consumers probably won’t associate the symbol of a horse with a famous Italian sports car. Of course, there are many sophisicated city folks that do make the connection, but the legal standard is not based on a reasonable sophisicated city consumer.

  • Todd (a different one)

    Dear Brad Luo -
    If you do not think that “China Business Law Blog” sounds like “China Law Blog”, you need to be looking into a different profession. They most certainly bear similarity.
    I am not an attorney, but both “China Law Blog” and “China Business Law Blog” are not names that anyone would likely want to run out and copyright. These are not so much invented names as they are descriptive names.
    When it comes to chosing a domain name, there are things to consider. In selecting a “unique” name, the user has the chance to seek copyright protection. The downside is that it might take time to educate consumers about the meaning of the unique name. If the domain name is descriptive enough, no education needs to be done. Without having read the blog, everyone can guess what “SwedishMotorcycleMechanic.com” is generally about.
    Any discussion related should not be about the law, but about how one creates and promotes a website. There is value in having a space on the Internet which is slightly unique.
    Could a consumer confuse China Law Blog and China Business Law Blog? Most certainly. And I believe that is the test that many in IP woudl use. I am not trying to claim that there is any real issue related to IP here.
    I guess what I’m suggesting is that your choice in a naming suggests a lack of imagination on your part. And that is the main point when it comes to IP issues in China, isn’t it? There are 26 letters in the alphabet. Couldn’t you have picked some others?

  • http://www.chinalawblog.com China Law Blog

    Todd Platek –
    Worry not, my professional assessment is that your name is a famous trademark though I will remain mum as for what.

  • http://www.chinalawblog.com China Law Blog

    RedKemp –
    Why Ford? Think big. Go Mercedes or BMW or Audi or…. Doing a trademark search in China and making sure you are doing it right actually requires bringing in the people in the trademark office and that can take weeks. There are some services that allow you to do it online, but I personally do not trust any of them yet.

  • http://www.chinalawblog.com China Law Blog

    Todd (the other non-Platek one) –
    Oh I see. Okay, now I’m no longer pissed off. I really don’t see a problem with China Business Law Blog for a couple of reasons. First off, there are only so many words one would want to use in naming a blog on China law. I will give myself kudos for grabbing the http://www.chinalablog.com domain quite some time before we even went live with the blog. That leaves Chinalawyerblog.com, Chinaattorneyblog.com, chinalegalblog.com, etc. So Brad picked a name that he felt best describes his blog. I do not think he picked it to try to ride coattails on us. Second, I have seen absolutely no evidence of Brad trying to instill confusion or enagage in anything remotely ressembling unethical conduct surrounding his blog. He put us in his blogroll on day one. If he wanted to stir up confusion, why would he have done that? He has cited our blog, and again, why do that if you want to cause confusion? Believe me, if I for a moment thought Brad had done anything untoward, I would crush him (that’s a legal term). No kidding.
    I went after Lehman big time when they used the design of our website (not our blog) and they quickly shut it down, explaining that it was done by a lower level employee. I went after the firm in Mongolia that listed Steve Dickinson (of this blog and of my firm) as one of its members (we actually learned of this when a good sized German firm wanted to hire us on a good sized project in Mongolia. I had to refer them to other counsel. There was a Chinese lawyer who started a Chinalawblog a few weeks after us and I e-mailed him and asked him to change his name and he did. There was another blogger who was taking our posts and using them without any attribution and I gave him 24 hours to give us attribution or be exposed and the attribution flowed like …. I just don’t see it here with Brad’s blog. I just don’t. I mean, it would be like if someone named their law firm Seattle Law Firm and then someone named their firm Seattle Business Law Firm and then someone named their law firm Seattle Real Estate Law Firm. I just don’t think Seattle Law Firm would have a good case.

  • http://www.chinalawblog.com China Law Blog

    ToddPlatekWannabe –
    WHY?

  • http://www.chinalawblog.com China Law Blog

    john troll –
    I do not think it makes sense to count on succeeding as a well known brand in China in all but the most limited instances. I say go ahead and spend the very small sum to register right away so that you get priority to your name. We register trademarks in China just about every week and it is relatively easy and relatively cheap. We have never tried to prove a well known brand but I have to believe it is no easier and no cheaper and so what is the point?

  • http://www.chinalawblog.com China Law Blog

    Brad Luo –
    Flattery will get you everywhere.

  • http://www.chinalawblog.com China Law Blog

    Brad Luo (ii) –
    At the risk of being accused of copying (just kidding!), I am going to agree with you that the decision was not outrageous.

  • http://www.chinalawblog.com China Law Blog

    Todd (a different one) –
    Interesting point.

  • http://chinabusinesslaw.blogspot.com Brad Luo

    Todd ( a different one):
    For “lack of imagination”, I cannot explain my position regarding infringement any clearer.
    When choosing the name for my blog, “copying” CLB was far from my mind. I deliberately added Chinese text after China Business Law Blog to distinguish my blog from CLB. Had blogger.com allowed chinese characters in the URL, I would have added that to distinguish even further.
    As far as why I didn’t choose other combinations of the 26 letters, here is the explanation:
    1. I’m a citizen of China, so I didn’t know using “China” in my blog was off limits.
    2. I’m a law student, so I didn’t know that “law” was not allowed.
    3. I plan to practice business law, and most of my research, directed or undirected, have focused on comparative analysis of Chinese business law. So, I did not see a problem using “business” either.
    Not to sound self-righteous, but one of a lawyer’s most valuable assets, if not the most valuable, is his reputation. Similarly, to a law student, following the honor code in law school is to me as important as honing legal skills. I have held on to that principle and will continue to do so.
    Please note that accusing a law student of “copying” without substantive proof, especially this one, is in effect saying he has broken his honor code. And I have a problem with that.
    As long as Mr. Harris does not have a problem with me using my blog name, your gripe about my blog is of no consequence other than it offends my sense of honor.
    With respect to “I guess what I’m suggesting is that your choice in a naming suggests a lack of imagination on your part. And that is the main point when it comes to IP issues in China, isn’t it? “, it is a sweeping generalization that goes beyond the current issue of web address names. Some other blogger in a different blog post comment here already cautioned against generalizations about China-related issues, and I don’t see the need to address it again.
    Finally, if you haven’t, I suggest you visit my blog to see if you get confused about where you are at.

  • ToH

    CLB and Brad Luo -
    It’s interesting that CLB supports CBLB, and I certainly see the point behind blog naming, in general.
    I want to reiterate – I do not suggest that there is ANY copyright issue here, specifically, or even an issue related to law, more generally. It is all about marketing.
    Did you seriously not weigh the risk of a criticism when you chose a blog name that is nearly identical to CLB?
    Is every instance of mimickry to be considered a form of flattery?
    Really?
    ToH

  • ToH

    CLB and Brad Luo -
    It’s interesting that CLB supports CBLB, and I certainly see the point behind blog naming, in general.
    I want to reiterate – I do not suggest that there is ANY copyright issue here, specifically, or even an issue related to law, more generally. It is all about marketing.
    Did you seriously not weigh the risk of a criticism when you chose a blog name that is nearly identical to CLB?
    Is every instance of mimickry to be considered a form of flattery?
    Really?
    ToH

  • Brad Luo (and CLB)

    Have enjoyed these recent exchanges, all in good fun. No insult intended. Just some thoughts. Wanted to add that is all…

  • Charles Liu

    Let’s see the pictures. Is there distinguishing features between the horses?
    Also is it fair for Farrari to claim all forms of pracing horse (facing both ways, various poses)? Farrari’s logo is “prancing horse in the Shield” with it’s name underneath. Is White Clouds Sports claiming everything, including the shield and name underneath?

  • http://calpolymbatrip.com Chris Carr

    Dan,
    Good post. I assume this court issued a written decision? And if so, do you know how I might obtain a copy of it, preferably translated into English?

  • http://www.chinalawblog.com/2007/12/the_technical_side_of_china_tr.html China Law Blog

    The Technical Side Of China Trademark Law: Forget You Ever Read This

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  • http://www.chinalawblog.com/2008/01/china_trademarks_do_you_feel_l_1.html China Law Blog

    China Trademarks — Do You Feel Lucky? Do You? Part II

    In an earlier post, entitled, “Do You Feel Lucky? Do You?” I wrote about how Ferrari had just lost a ten year battle to prove its horse constituted a famous mark such that it did not need to register it in China to achieve trademark protection there. I…

  • http://www.chinalawblog.com/2008/08/china_ip_neither_hong_kong_nor.html China Law Blog

    China IP: Neither Hong Kong Nor Macau Need Apply.

    Interesting post over at China Business Law on registering IP in Macau, got me to thinking of a company who came to me last year for assistance in pursuing trademark infringement litigation in China. As I always do in these situations, my first questio…

  • http://www.chinalawblog.com/2009/02/getting_your_consumer_product.html China Law Blog

    Getting Your Consumer Product Into China.

    Silk Road International has an excellent post on importing consumer products into China. The post is entitled, “Q & A about Importing into China,” and it starts out discussing why importing Western product into China is so rife with opportunity. To gro…

  • http://www.chinalawblog.com/2009/06/which_comes_first_the_trademar.html China Law Blog

    Which Comes First, The Trademark Or The OEM Contract?

    I am paranoid about my clients registering their trademarks in China, pretty much before they do anything else. For a few examples of my feelings on this, check out, “China Trademarks — Do You Feel Lucky? Do You?” “China Trademark Law: Simple And Effe…

  • http://www.chinalawblog.com/2010/01/bad_faith_trademark_registrati.html China Law Blog

    Bad Faith Trademark Registration In China. Good Luck With That.

    Every few months, my law firm gets contacted by a Western company that wants us to pursue a bad faith trademark case against a company in China. Typically, the Western company wants to pursue litigation against a Chinese company for having trademarked …

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    This latest recession has only caused even more small and medium sized businesses to look to cut costs by outsourcing their product manufacturing to China. Unfortunately, many of these companies now engaging in OEM (original equipment manufacturing) ou…

  • http://asianprosource.com Hunter Thompson

    Thank you for the advice, and the case study. Doing business in China can be a tricky obstacle course to navigate.. especially if you’re trying to china sourcing without knowing who to go to.

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  • Melgar Jose

     I have noticed that you can break Chinese company names into chunks:
    (Region where company is based: Liaoning) (Commercial brand name:
    ZhongYe) (Words that identify the nature of the business: Digital,
    Commercial, Trading, Manufacturing, Equipment), (Limited company
    abbreviation: Co. Ltd.) Tell me if I am wrong. Cheers from Guatemala.