In order to facilitate trademark registration, China Trademark Office announced 3 batches of acceptable goods and service names for trademark registration, on July 13, August 23 and September 19 respectively, totaling 3,220 items.

The Chinese versions of the new items can be found in the following links:

1st Batch：http://sbj.saic.gov.cn/tz/201607/W020160713522089272825.xlsx

2nd Batch：http://sbj.saic.gov.cn/tz/201608/W020160824308372317062.xlsx

3rd Batch：http://sbj.saic.gov.cn/tz/201609/W020160920407950702242.xlsx

In correspondence to the most urgent needs of our clients, Unitalen has completed translation of the first-batch items into English. Whoever interested in getting a copy of this, please contact mail@unitalen.com.

According to Farhan Haq, Deputy Spokesman for the Secretary-General of United Nation (UN), on August 15, Switzerland remains at the top of the Global Innovation Index (GII) while China is found among the Top 25 for the very first time this year. The 2016 GII was co-announced on the same day by UN World Intellectual Property Center and other organizations including US Cornell University in Geneva, Switzerland.

Starting from 2007, GII is published annually. The top runner this year is the same as last year - Switzerland, followed by Sweden, UK, US, Netherlands and Singapore. Aside from Singapore, other Asian countries / regions found in the top rows are Korea (No. 11), Japan (No. 16), Hong Kong China (No. 14) and China, which raised from No. 29 last year to No. 25 this year. The World Intellectual Property Center acclaimed that through the study of the innovation capabilities of over 100 countries and areas over the last 9 years, China has made significant progress in innovation, although mostly those in the leading positions of GII are highly advanced economic entities.

In 2016 GII, Japan, US, UK and Germany stand out in the aspect of “innovation quality”. “Innovation quality” is one of the top-tier benchmarks to examine the quality of universities, science publications and international patent filing amount. China is at No. 17 in “innovation quality”, which positions it at the top of the middle-income economic entities ranking, followed by India.

According to State Administration of Industry and Commerce (SAIC), the accumulated trademark filing in China reached 20.143 million as of the end this June, accumulated trademark registration 13.257 million, and registered trademark 11.223 pieces, with all of the above-mentioned numbers surpass 10 million for the first time. Up to now every 10,000 Chinese market entities own 1,389 trademarks in China.

Case Summary:

The plaintiffs - Blizzard Entertainment, copyright owner of “World of Warcraft” (WoW) online game, and Shanghai Netease Internet Technology Development Ltd.(Netease), the sole distributor of WoW in mainland China (jointly as the plaintiffs) filed a lawsuit against Chengdu Qiyou Technology Ltd. (Qiyou), the developer of “All Star of Warcraft” (ASoW, original name as “Chief of Tribe Thrall”), Beijing Rekoo Mobile Game （Rekoo）, the sole distributor of ASoW, and Guangzhou Dongjing Computer Tech Ltd. (Dongjing), the provider of game download service for infringing the copyright of WoW art work, with Rekoo further accused of unfair competition for making fraudulent advertisement and using the special names and decorations of the well-known WoW game without permission. The plaintiffs applied for preliminary injunction along with the lawsuit, requesting the court to order all defendants cease infringement acts immediately and provide cash deposit worth of 10 million yuan. Guangzhou Intellectual Property Court issued the injunction ruling after holding a hearing with both sides, which remained effective until a judgement was made, while the provision of balance checking and refund services to the ASoW gamers were not be affected during the injunction period.

Observation:

To ensure “proactively cautious and reasonably effective” injunctions, the courts put emphasis on examining the plaintiffs’s chance of winning and whether the plaintiff is enduring irreparable losses. In this case, considering the market share of the plaintiffs’ newly released games that would be taken by the defendant’s game, the online game’s characteristic of gaining popularity at fast speed and broad range within short life cycle, which would make it difficult to measure and quantify the damages to the plaintiffs’ interest, as well as the damage that would be caused to the plaintiff’s business reputation by the off-taste marketing of the defendant’s game, the court issued the preliminary injunction. Meanwhile, in order to protect the public gamers’ interest, the injunction did not affect the defendant’s services of balance enquiry and refund, which need be provided continuously to the gamers. This case symbolizes the determination of China’s courts to enforce juridical protection over IP rights and this was enlisted as one of the typical cases published by the Supreme Court in 2015.

Case Summary:

Guiyang Yuyan District Qihang English Training School (Qihang English Training), registered the trademark“启航学校 Qihang School” in Class 41 covering Schools & Education Services in 2003, and licensed to Beijing Zhongchuang Dongfang Education Technology Ltd (Zhongchuang) for exclusive use. Later Zhongchuang uncovered that Beijing Haidian District Qihang Examination Preparation School (Qihang Exam School) and Beijing Qihang Century Technology Development Ltd (Qihang company) used the mark 启航考研 （Qihang Graduate Exam） in their co-run website (www.qihang.com.cn), propaganda materials, business cards, training materials and franchising recruitment materials. Zhongchuang believed such use had infringed on their exclusive right to use the registered trademark trademark“启航学校 Qihang School”, and initiated a lawsuit at the court. On the other hand, Qihang Exam School was founded in 1998 and Qihang company in 2003. During the period from 1998 to 2001, Qihang Exam School drafted and published various sorts of graduate school entrance exam preparation books. Qihang Exam School and Qihang company believe their use of 启航考研 （Qihang Graduate Exam）is a fair use of their own business names that enjoy a prior right without infringing on the trademark right licensed to Zhongchuang. After hearing the case, Beijing Haidian District People’s Court and Beijing IP Court both decide that, as Qihang Exam School had used “Qihang Graduate Exam” in the published books and student recruitment advertisements in public media prior to October 18, 2001, the application date of the trademark “启航学校 Qihang School” and had established certain level of market influence, their use does not constitute infringement to the registered trademark in accordance with Clause 3 Article 59 of the Trademark Law.

Clause 3 Article 59 of the Trademark Law says: Where a registered trademark had been prior used by others with certain established influence, the exclusive right holder of the registered trademark shall have no right to prohibit the others from using the mark within the original scope, but may request the user to add proper marks for distinction. This clause was added during the 3rd revision of the Trademark Law, with very few applicable cases found in juridical practice yet. This case has helped provide comprehensive analysis and reasoning on the application of this clause, and detailed discussion on the point-of-time for prior use, determination of certain influence and original scope etc., which shall be of great significance to study for future similar cases.

Case Summary:

In 2003, Honda Motor Co. Ltd (Honda) sent a warning letter to and filed a lawsuit against Shijiazhuang Shuanghuan Automobile Co., Ltd (Shuanghuan) for infringing Honda’s car design patent.

Shuanghuan on October 16, 2003 filed a lawsuit with Shijiazhuang Municipal Intermediate People’s Court for affirming the disputed car hasn’t infringed on Honda’s design patent at issue, and later filed request for invalidation of the Honda’s design patent with Patent Reexamination Board. After the administrative decision announcing invalidity of Honda’s design patent was sustained by the first and second instances of administrative litigation, Shuanghuan requested to increase the amount of indemnity in their litigation for affirming non-infringement to 25.79139 million yuan on April 26, 2008, to compensate for their economic losses, legal fees, evaluation fees and litigations fees because Honda’s continuous sending of warning letters had forced them to postpone the sales of the disputed car and to reconstruct car design and molding equipment. In disagreement with the patent invalidation decision, Honda requested retrial of the case and the Supreme Court issued 2010 No. 3 Administrative Judgment on November 11, 2010 to revoke the invalidation decision. Upon restoration of the patent right, Honda increased their claim of indemnity amount and upgraded the patent infringement litigation case to Hebei Province Higher People’s Court.

Per adjudication by the Supreme Court, Hebei Province Higher People’s Court (Hebei Higher Court) had a combined trial of the patent infringement case and the litigation for affirming non-infringement. On April 1, 2013, Shuanghuan further requested increase of indemnity to 365.74 million yuan for negative messages distributed by Honda’s warning letters and damage caused to their business right and reputation. Hebei Higher Court made the first-instance judgement, affirming Shuanghuan’s disputed car as not infringing on Honda’s design patent at issue, ordering Honda pay 50 million yuan’s indemnity (including reasonable legal fees) to Shuanghuan, while rejecting all other claims by Shuanghuan. Both Shuanghuan and Honda appealed to the Supreme Court. While re-affirming Shuanghuan’s disputed car as not infringing on Honda’s design patent at issue, the Supreme Court lowered the indemnity to be paid by Honda to 16 million yuan.

Observation:

The case lasted for over 12 years, involving jurisdiction dispute, patent infringement litigation and litigation for affirming non-infringement. The final ruling clarified two distinct legal relationships: dispute over non-infringement affirmation and dispute over indemnity, and made adjustment to the cause of case accordingly.

The ruling of this case makes it clear that, while the IP right holder has civil right to protect its legitimate interests by sending infringement warning, the execution of such right shall be within reasonable scope. The appropriateness of the right holder’s enforcement activity shall not be determined by the final conclusion of infringement or not; instead, it shall be determined by whether the right holder’s enforcement activity has violated the fair competition order and whether it has been used as a strike to competitors in reality. On the other hand, however, due to the professionalism and complexity involved in infringement determination, the requirement for the right holder to determine the appropriateness of infringement warning shall not be held too high; otherwise, it will hamper the normal function of infringement warning system and go against its original intention.

The ruling of this case provides elaboration over the legitimacy of infringement warning, its relationship with fair competition and the commercial risks borne by market players; it also provides detailed reasoning and clear determination over whether sending an IP infringement warning is an appropriate enforcement conduct or an unfair competition conduct, and how to decide the indemnity caused thereby, thus it has established legal norms regarding IP right holders’enforcement through warning and provided reference for similar cases.

In the morning of August 10, World Intellectual Property Organization delegates including Professor Dr. Annette Kur from German Max Planck Institut fur Chemie - Otto Hahn Institut, MPIC and Ms. Martha Chikowore from WIPO, along with the dean and professors of Tongji University IP School, visited Unitalen’s branch office in Shanghai.

WIPO delegates mentioned during the visit that WIPO will work with Shanghai Government to set up an international IP school based on Tongji University IP School, to promote training of high-end IP professionals, as well as to output Chinese professionals that understand international laws and practices to international organizations e.g. WIPO and EU. Also, WIPO welcome the top notch Chinese IP firms and organs to join this initiative.

WIPO delegates gave high praise to Unitalen’s rich experience in IP field, solid foundation in both practices and academic study, plus years of cooperation with Tongji University, Tsing Hua University, East China University of Political Science and Law, Dalian University of Technology, Zhejiang University of Technology in providing trainings to high-end IP talents, and expressed their wishes to Unitalen in maintaining communication and cooperation as well as promoting IP development.