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

Posted in Legal News

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 made clear that the best way to avoid such fights is simply to register:

Our advice to all our clients is to register their trademarks in China before they go there. China is a first to register country and this 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 almost certainly have spent well over $5,000 in making your case.

Microsoft has just learned the same lesson. The China Business Law Blog has an interesting post, entitled, “Microsoft Falls One Step Behind in Protecting ‘Windows’” on how Microsoft is fighting for trademark protection of its “Windows” name in China, based on its claim to that name being famous. Now before anyone jumps up and down and starts talking about how of course “Windows” is famous, I urge you to sit down and take note of the fact that Microsoft is trying to stop an eye glass company from using the name for its eyewear. It seems that a Ningbo eye glass company tried to register the trade name “Windows” under Class Nine for eye glasses and Microsoft objected. China’s Trademark Office (CTMO) apparently found that “Windows” is not famous for eye glasses and has allowed the eye glass company to use that tradename.
China Business Law Blog sees Microsoft as having made one of two mistakes:

Without further facts or the CTMO written decision, I can only assume what went wrong on the part of Microsoft. Two possible scenarios exist here that might have led to Microsoft’s misstep in protecting “Windows” in China. First, Microsoft simply forgot to register “Windows” in China, which is unlikely given its level of legal sophistication. Second, it registered “Windows” in China but did not cover Class Nine, limiting its rights to the classes of goods or services registered for.

China Business Law Blog goes on to talk about how Microsoft may still be able to prevail here:

All is not lost though. Assuming that Microsoft registered “Windows” for certain classes of goods (say, software), it could ask either the CTMO or a People’s court to give “Windows” the famous mark status, thereby availing itself of broader protection. It is unlikely that Microsoft’s counsel has not tried that at the CTMO, but it can still try at an intermediate court in Zhejiang province where Ningbo is located. The court might find “Windows” legally famous for software (and whatever Microsoft registered it for in China), and might rule that the registration or use of “Windows” by another applicant for eye glasses is likely to dilute “Windows”, the famous mark for software.

I completely agree with the China Business Law Blog both on what has probably taken place here and on what Microsoft may have left to do to salvage its situation. I will go a step further though and say that under Chinese law, Microsoft is not likely to prevail unless the court decides to rule in its favor for international political reasons. If we were dealing with a name like Coca Cola, I would be betting on Coke to prevail because anyone using that name for any product (not just beverages) is clearly seeking to trade off Coke’s famous name. In the case of “Windows” however, the Ningbo glass company can claim that Microsoft failed to register that name in Class Nine, that the word windows can be applied to eyeglasses such that using it is not necessarily an attempt to take advantage of the Microsoft Windows name, and that Microsoft had every opportunity to spend the few thousand dollars it would have taken to register “Windows” in Class Nine.
I’m guessing Microsoft is not feeling all that lucky today.
Full Disclosure: Though I live in Seattle and Microsoft is in a suburb about 25 miles away, my house is surrounded on all four sides by Microsoft employees.

  • Amban

    I sort of wonder when this blog will comment on the Yuan Hongwei vs. ABRO case, which is bandied about in media? Why this silence?

  • http://www.foarp.blogspot.com FOARP

    I’m confused, I thought SIPO (State Intellectual Property Office – 国家知识产权局) was the Chinese patent office, what’s with this CTPO? Heck, it’s confusing enough when the UKPO is called the UKIPO, the EPO operates under the EPC, and PCT applications go to WIPO – who wants more acronyms?
    On a more serious note, I truly don’t see how use in glasses does much to dilute or tarnish Microsoft’s good will in the Windows trademark. Nor is Windows as distinctive a trademark as it used to be, in fact, nowadays I would say it’s getting rather descriptive – what else do you call those box thingies on your computer screen?

  • Eric van Naerssen

    Choosing acronyms to represent China entities will continue to be a fungible art until some group has enough weight to set definitive standards.
    Meanwhile CTMO, administered by the SAIC, is still used by the 商标局 on its official website. As the characters read, there is no “Protection” in the name as implied by CTPO. I do not believe the absence of this verb reflects one way or another on the priorities of the office. Microsoft might disagree.

  • Reader in China

    Is it just my computer or the firewall that prevents me from reading chinabusinesslawblog? Most blogspot blogs are blocked here so none of us here in China can read it. Just wondering why someone would host a blog about Chinese law that can’t be read in China.

  • Kevin Moore, Peking Uni. LLM candidate

    As the name “Windows” in Chinese (“窗”, I believe) appears to be at dispute here, I’m curious if a) it is necessary — or just advisable — that foreign enterprises operating in China register a Chinese name and, b) whether it has been established that famous mark (and other trademark) protections extend similarly to names in foreign script as to those in Chinese.

  • http://www.whataboutclients.com/archives/2008/01/china_trademark_1.html What About Clients?

    “China Trademarks–Do You Feel Lucky? Do You? “

    By Dan Harris, no punk, and hands down the most feisty China hand on the planet, at China Law Blog: Part II. Listen to him….

  • Alex

    IANAL but I do read Slashdot, providing me with a hugely biased view of the law and legal cases, especially those relating to the fields of trademark/copyright/IT.
    I understood that common words could not be trademarked as a general term, but can be trademarked when relating to a specific service or product for which that name (term) is found unique.
    Therefore I am somewhat confused why a glass product manufacturer is being sued by a software manufacturer for trademark infringement, in China, in the US, anywhere, when the term they use is ‘Windows’ (in Chinese or English).
    As for a glass company trademarking the term of a glass product (if they are indeed trademarking “窗”)… surely that could not be upheld. And perhaps that’s the reason.

  • http://foarp.blogspot.com FOARP

    @Kevin – China is a signatory of TRIPS just like every other member of the WTO, protection of unregistered famous marks (and thus, to a lesser degree, of their translations) can be obtained in China depending on how famous they are actually judged to be in China. This can be difficult to show, and can require evidence from surveys etc. that can be difficult (or impossible) to collect here in China. Starbucks have successfully sued people using the mark ‘星巴克’, even though the offending party (who provided similar goods and services) had registered the mark in China in respect of the relevant classes as early as 2000 – long before Starbucks entered the Chinese market.
    Signatories of the TRIPS agreement general have to allow holders of famous marks to prevent people mischieviously registering their marks in jurisdictions they have no great prescence in. Since the matter of mischief on the part of the junior mark has presumably been dealt with, the issue in this case is whether Windows is such a distinctive mark that its use in respect of such disimilar and unrelated goods and services means that the defendant can be found guilty of dilution (i.e., non-confusion infringement) of the trademark.
    Under UK law there would have to be some kind of link suggested in the consumer’s mind between the senior mark (Microsoft) and the junior (see Jacobs LJ in the L’Oreal case, now being referred to the ECJ), as well as resulting damage. Under German law, if there was ‘free riding’ on the part of the junior mark then this might be enough also, but, I really don’t think there has been. I did not find Windows to have a very high name recognition in China (although Microsoft does),as I said before, it is not a very distinctive mark (being a common word suggestive of what it is). On the other hand, I don’t know what the test in China is (or if they even have one) so if anyone knows I ‘d love to hear it.
    At any rate, if they had wanted it they could have registered it when they had the opportunity (although this might only grant five years before they might have been challenged for non-use).
    I attended a brilliant seminar given by Neil Wilkof of the Israeli firm Herzog, Fox, and Neeman on monday on trademark licensing and transfer – maybe this might be the answer for Microsoft. If they don’t feel it worthwhile to pay good money to obtain the mark in respect of eyeglasses then what are they playing at sueing people for using it?
    @Eric Van Naerssen – Thanks a lot for the heads-up, in the patenting business I had only ever heard of SIPO. Oddly enough I had thought that having the words ‘intellectual property’ in their name meant that they dealt with all the registerable rights, but I guess I was guilty of thinking logically – big mistake!

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

    CLB & Readers:
    My apologies for using the wrong abbreviation for the China Trademark Office; it was a plain error, and it has been corrected. Please read my follow-up post:
    http://chinabusinesslaw.blogspot.com/2008/01/woe-to-assumptions.html
    Once again, please accept my apologies for this technical error.

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

    Amban,
    Good question. Every time I am about to do a post on it, someone has beaten me to it. Also, I see it as more of a political issue than a legal one, but it is certainly post-worthy and I will probably do something on it eventually.

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

    FOARP,
    You are correct. Our error. We have both now fixed it. Thanks for catching this. I should have.

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

    Eric van Naerssen,
    You are right. I hate them and in my legal briefs I almost never use them at all. They confuse me/people, even when used correctly. The only time they work well is when they have become so common that people have pretty much forgotten the full name.

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

    Reader in China,
    Good point. I am constantly telling this to other China bloggers on blogspot.

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

    Kevin Moore,
    It is NOT necessary to secure one’s trademark in Chinese characters, but certainly it is oftentimes advisable. Filing in both Roman letters and Chinese characters definitely increases the cost, but many times it is well worth it. It really is a case by case basis. I would estimate that of the trademark filings in China that my firm overseas, 95% are in Roman letters, with about half of those adding Chinese as well. 5% are just in Chinese.
    Chinese trademark protection does extend to trademark filings in Roman letters. Absolutely.

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

    Alex,
    You are generally right, but this stuff gets incredibly complicated. Incredibly. For example, it is very unlikely one could trademark the name Muslin for a cloth, because it is a kind of cloth, but one probably could use that name for a computer. I doubt “windows” could be trademarked for windows, but, apparently, it can be for eyeglasses. These complications are present in all countries and I am always shocked when companies choose to file for their trademarks without legal counsel.

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

    FOARP,
    Proving the “famousness” of one’s brand in China is very difficult and, it is generally the case that “famous” is based on within China, not outside China. Co-blogger, Steve Dickinson, has spent literally hundreds of hours researching these issues (all in Chinese) on behalf of our clients engaged in trademark disputes and the nuances here are just incredible. What if you register your trademark for a clock, can someone use that same trademark for a clock-radio? What if you have the trademark for a clock, and someone registers that samd trademark for a radio, who gets to use it for a clock-radio? There are countless published Chinese court decisions on issues just such as these. The most common mistakes we see are from those who find ONE category that fits their product/trademark and then register for that one category, without realizing they have left it wide open for someone to come in and register their trademark in another category that will cross over into yours. Again, it amazes me how people go it alone in this legal area, only because they do not know enough to realize how complicated it really is.

  • robert li

    Regarding to the windows case, I am of the view that the most important issue should be Microsoft choose the common word as a trademark. You can not forbid others to use the similar word on other unrelevant products. Just like Apple computer company could not stop others to use Apple on garment.

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