To start off the year of 2024 on a good note, we have selected our firm’s top 5 representative and significant intellectual property cases in 2023 to share with you our successful cases and the hottest issues in the previous year.
1. Nullified fraudulent trademark assignments by cunning swindler
We have been assisting a European clothing brand in taking back its trademark portfolio in China fraudulently obtained by a bad faith party. An individual who previously negotiated an acquisition of client’s China arm forged the signature of our client’s majority shareholder and assigned more than 80 of our client’s trademarks to her own name.
Through multiple administrative litigation suits before the Beijing Intellectual Property Court, we nullified the fraudulent trademark assignments. We argued that the China National Intellectual Property Administration (CNIPA) has an obligation to review the assignment documents in substance, and that it has failed to exercise due diligence in examining the forged assignment documents filed by the counterparty when there were obvious doubtful points. For instance, the forged signatures on the assignment documents were all identical, which was not reasonable. The court accepted our arguments and ruled in favour of our client, nullified the forged assignments, and requested CNIPA to re-examine the case. Such success allows our client to get back its rights in China from the fraudulent party.
2. Prevented copycats from riding on movie characters
Our client is a motion picture company that owns the copyright and trademarks to the characters, elements, and other materials of a famous action thriller movie series. A Chinese company registered a mark on a wide range of goods including hand tools, heating apparatus, cooking utensils, sanitary apparatus, and installations, etc., which comprises of elements similar to the major character in the client’s action thriller. The word element of the mark refers to the character’s alternative name, while the device element resembles the character’s classic apparel design in the action thriller.
We obtained a favorable judgment in the Beijing Intellectual Property Court invalidating the counterparty’s mark. The court not only protected the client’s house character names but also the variant formats or alternative character names.
In support of our arguments, we assisted the client in gathering evidence including media reports to establish the client’s prior rights on character names and character’s apparel element. We have also conducted further investigation to show the bad faith of the counterparty, and submitted the counterparty’s official website screenshot to prove that together with its affiliated companies they were taking advantage of the client’s character name and the corresponding movie in their promotion activities.
This case significantly bolsters client’s future enforcement actions against parties which free ride their famous character names including alternative names, as well as other elements of their characters in China.
3. Tackled an organized cheating group in a criminal case on behalf of a leading education and testing institution
We manage the greater China portfolio for one of the world’s largest private non-profit organization engaging in educational testing and assessment services. Cheating in such standardized testing was an issue which our client has been trying to tackle. This year, we assisted our client in joint efforts with the police on this issue.
The police in a southern city of China took action against an organized cheating group participating in our client’s testing services and sought assistance from our client for verification of information. We represented the client to liaise with the police, suggesting to the police the possible legal grounds of the charges and actions to be taken against the cheating group, and obtained useful information from the police.
Under the current practice, unlike public recognized exams in China, cheating activities in other tests or assessments organized by educational companies may not constitute a criminal offence in China. We provided input to the police on the possible charges that may be laid against the cheater, including the illegal use of computer information system. We acted as a bridge for the client to obtain information from the police so that the client could determine possible remedial redress in this particular cheating case. Our client also obtained further information from the police which helped them determine if corresponding action needs to be taken to maintain the integrity of the test it operates.
Such cooperative exchange of information between clients and the police paves the way for more co-operation with the police in future investigations and tackling other issues criminally.
4. Successful buyback from cunning trademark squatter for a famous fashion designer
We act for a well-known fashion designer who has been acting as the creative director for various luxury fashion brands around the world and launched his own menswear label in the 2000s. Due to the popularity of the client’s brand and his own personal fame, there were many pre-emptive filings registered across different classes in China, for example, a mark consisting of his English and Chinese names on clothing was pre-emptively registered in as early as 2003. Given the difficulty to invalidate such an old registration and to collect such dated use evidence in China, the client opted to buy back the squatter’s marks.
In fact, the negotiation for buy back was not originally smooth given that one of the squatters insisted that they have been using the mark legitimately and initially asked for an unreasonably high amount for the buyback. To increase the bargaining power of the client, we simultaneously launched an invalidation claim against the squatter’s marks up to the Beijing Intellectual Property Court to assert further pressure on the squatter to agree to a lower price. Our tactic was successful and we negotiated a significantly lower price for the target trademarks and efficiently completed the trademark assignment procedures.
5. Successfully defended non-use cancellations against client’s house marks with minimal disruption to client’s business teams
In China, many trademark squatters attempt to copy and imitate the marks of our client, a famous French fashion house. Some applicants even filed non-use cancellation against our client’s trademarks in the hope of removing our client’s trademarks so that the infringing trademarks can proceed to registration.
A notable case this year is that a Chinese entity filed non-use cancellations against our client’s house marks on its core class. We have been assisting our client to regularly preserve and affix its evidence of use in China, and we have kept records of the list of products and its sub-brands offered for sale each year. Given the good practice and pre-emptive evidence preservation strategy, our client was able to produce dated evidence of use within the short response time. Our regular defensive filing strategy also ensured that our client has back-up applications for its core marks on core goods. To further strengthen our position, we also conducted updated internet searches on client’s official website, social media accounts, media reports, KOL’s blogs, etc. in order to locate additional evidence of use for specific products that were not available during our regular evidence preservation exercise. We also worked with the client to collect useful evidence (including website links, customer invoices, etc.) without causing undue inconvenience to their business team. As a result, we successfully maintained the client’s house marks on their core goods.
With the significant changes in the intellectual property world in China including but not limited to the release of the proposed draft amendment to the Chinese Trademark Law and the updates in data privacy law, we will continue to keep track of the updated laws and adopt applicable strategies in our cases striving to achieve successful and favourable outcomes for our clients.
© Vivien Chan & Co., Newsletter issue 29, February 2024
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About Us
Vivien Chan & Co. is a full-service law practice with offices in Hong Kong (1985) and Beijing (1993). We are consistently recognized as a premier law firm for and in Greater China. With over 35 years of doing business in Greater China, our Hong Kong and China teams have an in-depth understanding and knowledge of the legal culture and market dynamics.
Our long established licensed law offices in Greater China have allowed us to develop deep local roots and an integrated global perspective necessary to help domestic businesses and multinational companies alike seamlessly manage even the most complex local and cross border transactions.
We have advised on some of the most significant acquisitions, arbitrations, real estate projects and intellectual property enforcement to date. This is particularly evident from our leading position in areas such as intellectual property, tax, employment, mergers & acquisitions and dispute resolution. Our ability to collaborate across practices and borders with ease allows us to bring the right team to every transaction, regardless of location.
