{"id":1887,"date":"2022-01-07T20:24:35","date_gmt":"2022-01-07T20:24:35","guid":{"rendered":"https:\/\/www.chinaiplawupdate.com\/?p=1887"},"modified":"2022-01-07T20:24:35","modified_gmt":"2022-01-07T20:24:35","slug":"guest-post-tackling-bad-faith-trademark-applications-or-registrations-in-china-part-ii","status":"publish","type":"post","link":"https:\/\/www.chinaiplawupdate.com\/2022\/01\/guest-post-tackling-bad-faith-trademark-applications-or-registrations-in-china-part-ii\/","title":{"rendered":"Guest Post: Tackling Bad Faith Trademark Applications or Registrations in China \u2013 Part II"},"content":{"rendered":"<p><em>This is the second guest post in a 4-part series regarding defeating bad faith marks in China from <a href=\"https:\/\/www.beijingeastip.com\/\">Beijing East IP<\/a> authors <a href=\"https:\/\/www.beijingeastip.com\/professionals\/1895\">Yan Zhang<\/a>,\u00a0<a href=\"https:\/\/www.beijingeastip.com\/professionals\/miao-tian\">Miao Tian<\/a>, &amp;\u00a0<a href=\"https:\/\/www.beijingeastip.com\/austin-chang\/\">Austin Chang<\/a>. <\/em><\/p>\n<p><em>Previously, the authors shared the relevant stipulations regarding bad faith trademarks in the China Trademark Law 2019 (\u201cTrademark Law 2019\u201d), insights on the required factors when applying bad faith, and the current trend and practices. In the next few guest posts, they will share cases with analysis on how the China National Intellectual Property Administration (CNIPA) and the courts apply the laws to tackle bad faith trademark applications or registrations.<\/em><\/p>\n<ol>\n<li><strong> Opposition against \u201cCISCO\u201d filed by an individual<\/strong><\/li>\n<\/ol>\n<p>A Chinese individual filed an application for \u201cCISCO\u201d on August 27, 2018, designating \u201cRazors, electric or non-electric; Crimping irons; Beard clippers; Hair clippers for personal use, electric and non-electric; Depilation appliances, electric and non-electric; Pedicure sets\u201d in class 8. The applicant filed seven applications in total, including one in class 7 and the others in class 8.<\/p>\n<p>Cisco filed an opposition against the opposed mark before the CNIPA. The CNIPA found that Cisco\u2019s marks bore relatively high originality and the evidence can prove that, through Cisco\u2019s consistent use and promotion, its marks have obtained relatively high fame among consumers. The opposed mark was identical with Cisco\u2019s marks in terms of letter composition, so the CNIPA deemed that the applicant\u2019s filing for the opposed mark showed bad faith of copying and imitating Cisco\u2019s marks, which violated the good faith principle. According to Article 7 and Article 30 of the <em>Trademark Law 2019<\/em>, the CNIPA ruled to refuse the opposed mark for registration.<\/p>\n<p>Although procedurally, the applicant has the right to file an appeal against the refusal decision, he did not appeal the decision and the opposed mark has been recorded as void.<\/p>\n<ol start=\"2\">\n<li><strong> Opposition and subsequent Appeal against \u201cLAMAZE (stylized)\u201d<\/strong><\/li>\n<\/ol>\n<p>A Chinese company filed an application for \u201c<img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-1888\" src=\"http:\/\/www.chinaiplawupdate.com\/wp-content\/uploads\/2022\/01\/Lamaze.png\" alt=\"\" width=\"94\" height=\"50\" \/>\u201d on March 20, 2017, designating \u201cTable cutlery [knives, forks and spoons]; Cutlery; Spoons; Spoons, table forks and table knives for babies; Hand operated hand tools; Knives [hand tools]; Sabres; Graving tools [hand tools]; Nail clippers; Flat irons\u201d in class 8. The applicant has 14 applications in total, designating on goods of baby suits, babies\u2019 pacifiers, toys, cutlery, household linen, etc. in different classes.<\/p>\n<p>Lamaze filed an opposition against the opposed mark. The CNIPA found that, the evidence submitted by Lamaze can prove that, prior to the application of the opposed mark, Lamaze had registered and used the marks of LAMAZE and \u201cLAMAZE in Chinese\u201d and had obtained certain fame. Further, LAMAZE and \u201cLAMAZE in Chinese\u201d were fanciful words that bore certain originality. The opposed mark was identical with Lamaze\u2019s marks in terms of letter composition, which was hardly a coincidence and the applicant failed to make reasonable explanations of its creation source. Thus, the applicant\u2019s filing for the opposed mark showed bad faith of copying other\u2019s famous prior marks and free-riding of the goodwill thereof, which not only was likely to cause consumer confusion, but also impaired the normal order of trademark registration and fair competition, and violated the good faith principle.<\/p>\n<p>Given the above, the CNIPA refused the registration of the opposed mark based on Article 7 and Article 30.<\/p>\n<p>The applicant was not satisfied and filed a registration refusal appeal against the decision. In the appeal, the CNIPA affirmed the above findings and further ruled as follows:<\/p>\n<p>The Applicant filed altogether 14 applications, aside from the opposed mark, the other marks of \u201cVulli Sophie,\u201d \u201cB toys,\u201d and \u201cOXO tot\u201d are all identical with others\u2019 brands with strong distinctiveness and high reputation. As the Applicant neither made reasonable explanations nor provided evidence of its actual use of the marks, the Applicant\u2019s behavior showed obvious bad faith in copying others\u2019 marks, violated the good faith principle, impaired the normal order of trademark registration administration, and was detrimental to the market order and fair competition.<\/p>\n<p>Therefore, the CNIPA found the opposed mark constituted the circumstance of \u201cobtaining registration by other unfair means\u201d as stipulated in Article 44.1, and accordingly refused the opposed mark from registration.<\/p>\n<p>As the applicant did not further appeal the decision to the court, the opposed mark, as well as other marks filed by the applicant have been recorded as void.<\/p>\n<p><strong>\u00a0<\/strong><strong>Comments<\/strong><\/p>\n<p>In China, the division of class and subclass set in the<em> Similar Goods and Services Classification Guide <\/em>plays an important role in determining if the goods or services are similar. When the right owner\u2019s mark obtains certain fame but has not yet reached the degree of well-known, it is difficult to obtain cross-class or cross-subclass protection based on the provisions for similar marks used on similar goods and services in the <em>Trademark Law 2019<\/em>, even if the marks are identical or substantially similar. To combat such copycats, the bad faith clause could be considered as a good alternative.<\/p>\n<p>As we advised in Part I, several circumstances can be deemed sufficient to show bad faith:<\/p>\n<ul>\n<li>hoarding massive trademarks in various un-related classes;<\/li>\n<li>applying for many trademarks identical with or similar to multiple business signs with certain popularity or high distinctiveness;<\/li>\n<li>applying for a large number of trademarks within a short period of time and obviously beyond reasonable need; and<\/li>\n<li>having been found of being a squatter in earlier trademark cases.<\/li>\n<\/ul>\n<p>A mark\u2019s life depends on its use. In order to apply the bad faith clause, the easiest way is to prove that the other party does not have the intent to use the target mark and is hoarding trademarks for future profits through sales. For example, a large number of marks filed that designated a broad range of goods and services obviously exceed the reasonable need for regular business. These marks filed without genuine intention to use would usually turn into items for sale.<\/p>\n<p>Accordingly, it would not be difficult to convince the CNIPA to find that the applicant of an opposed mark has bad faith, if it applied for hundreds or thousands of trademarks, or if its applications are all copies of numerous famous brands and designated in all 45 classes, or it is selling the marks via public platforms or private channels.<\/p>\n<p>In the above two cases, however, the applicants filed a limited number of marks and designated goods for their core business, so the \u201choarding\u201d argument won\u2019t be as persuasive as these marks appear, on its face, to have \u201cgenuine intention to use.\u201d Not to mention that in reviewing and adjudicating administrative trademark cases, the CNIPA is rather prudent and strict in applying bad faith articles, especially at the opposition stage.<\/p>\n<p>Accordingly, to overcome these downsides, one can:<\/p>\n<ol>\n<li>Demonstrate with solid evidence the cited mark\u2019s strong distinctiveness and high fame;<\/li>\n<li>Illustrate the copied brands with great details;<\/li>\n<li>Find and demonstrate \u201cunique traits\u201d of the opposed mark\u2019s applicant.<\/li>\n<\/ol>\n<p>Demonstrating the cited mark\u2019s distinctiveness would minimize the likelihood of coincidence in creating an identical mark. At the same time, the cited mark\u2019s high fame implies the possibility that the opposed mark\u2019s applicant has access to the opposer\u2019s marks and the potential benefits from securing such a copied or imitated mark.<\/p>\n<p>As for demonstrating applicant\u2019s copying of the marks, the devil lies in the details and clarify on presenting to the CNIPA and courts with facts and evidence showing the applicant\u2019s copying behavior, the clearer the more likely that they will reward you with a favorable decision.<\/p>\n<p>In the CISCO case, among the seven marks filed by the applicant, six are imitations of Cisco, Philips or Siemens, whose distinctiveness and fame are well acknowledged. In the LAMAZE case, all the 14 marks filed by the applicant are copies of brands in the baby products industry.<\/p>\n<p>Last but not the least, \u201cunique traits\u201d of the opposed mark\u2019s applicant could turn out to be the more crucial factor that successfully offset the lack of \u201choarding\u201d in these two cases.<\/p>\n<p>In the CISCO case, the applicant is <em>an individual<\/em> as opposed to a corporation. In China, any natural person who applies for trademarks should be a responsible person running an individual business or a leaseholding rural household, or someone with the permission to engage in business operation. Compared with legal persons, natural person is required to file trademarks with designated goods or services limited to the business scope set in their business certificates or to their own agricultural products.\u00a0 Hence, it can be legitimately presumed that an individual, different from corporations who may have multiple brands and carry out various business operations, should have less need for filing multiple trademarks in various goods and services. Accordingly, though the absolute quantity of seven marks is not large, the fact that the applicant is an individual and the ratio of 6 copies and imitations out of the total 7 marks applied should overcome the lack of evidence of \u201choarding\u201d trademarks.<\/p>\n<p>In the LAMAZE case, the special trait of the applicant is being a \u201cpeer\u201d \u2013 the applicant is engaged in the baby products industry, the marks it copied are from the brand owners in baby products industry, the applied-for goods under the copied marks are related to baby products. A player in the same industry not only indicates a high possibility of awareness over the copied brands, but also increases the likelihood of consumer confusion if the copied marks are to be registered and used on the identical goods.<\/p>\n<p>Accordingly, the fact that the applicant resides in the same line of business and the odd proportion of copied trademarks to overall applications serve to offset the shortage of evidence of \u201choarding.\u201d<\/p>\n<p>Like we stressed in Part I, there is interdependence among the relevant factors for bad faith, and that a relatively small number of trademark filings may be offset by 1) a greater degree of earlier marks\u2019 distinctiveness, 2) a greater degree of the proprietaries\u2019 fame, 3) a higher level of association of the professionalism of the designated goods or services, etc. Similarly, a lesser degree of similarity between the marks may be offset by 1) a closer distance of two parties\u2019 domicile, 2) a closer relatedness of the two parties\u2019 lines of business, 3) a larger amount of the applicant\u2019s trademark filings, etc.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p class=\"excerpt\">This is the second guest post in a 4-part series regarding defeating bad faith marks in China from Beijing East IP authors Yan Zhang,\u00a0Miao Tian, &amp;\u00a0Austin Chang. Previously, the authors shared the relevant stipulations regarding bad faith trademarks in the China Trademark Law 2019 (\u201cTrademark Law 2019\u201d), insights on the required factors when applying bad faith, and the current trend and practices. In the next few guest posts, they will share cases with analysis on how the China National Intellectual &#8230;<\/p>\n<p class=\"more-link\"><a href=\"https:\/\/www.chinaiplawupdate.com\/2022\/01\/guest-post-tackling-bad-faith-trademark-applications-or-registrations-in-china-part-ii\/\" class=\"button\">Continue Reading<\/a><\/p>","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"coauthors":[44],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Guest Post: Tackling Bad Faith Trademark Applications or Registrations in China \u2013 Part II - China IP Law Update<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.chinaiplawupdate.com\/2022\/01\/guest-post-tackling-bad-faith-trademark-applications-or-registrations-in-china-part-ii\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Guest Post: Tackling Bad Faith Trademark Applications or Registrations in China \u2013 Part II - China IP Law Update\" \/>\n<meta property=\"og:description\" content=\"This is the second guest post in a 4-part series regarding defeating bad faith marks in China from Beijing East IP authors Yan Zhang,\u00a0Miao Tian, &amp;\u00a0Austin Chang. 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