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Trademark Hitchhiking on IPR in China
In a case, the plaintiff opposed defendants for use of his well-known and legally registered Trademarks: "LV" and "LV Pattern" unauthorisedly which caused trademark infringement and unfair competiton. So, the plaintiff filed suit for unfair competition claims and trademarks infringement.
The plaintiff's argued that since its trademarks were registered worldwide, and enjoyed high popularity around the world, the use by defendants without his permission caused trademark infringement and economic losses as well. The plaintiff further submitted that the defendants used its trademark logo in its advertising as a trademark and commodity design and the picture carrying logo on handbag mislead the consumers strongly. So, according to the Trademark Law and Anti-unfair competition law, the defendants' actions constituted both trademark infringement and unfair competition through false advertising.
The defendants held that firstly, the evidence produced by the plaintiff was insufficient to prove that the Mark LV was a well-known trademark and secondly the advertisement did not contain the LV trademark, but the LV brand handbag, which was only a prop in the model's brand rather than any identification for the building, and thirdly the advertisement would not mislead consumers because in the full length picture, the LV logo on the bandbag was far smaller than the characters in the picture and hence no consumer will be confused as to the ownerand operator of the buildings.
After hearing the parties, the Intermediate People's Court ruled that the behavior of the two defendants in using trademark logo on a handbag for their advertisement campaign was malacious and thus constituted unfair competition, violating the principles of equality, justice and good faith as well as generally accepted commercial ethics under the Paris Convention which states that "all member countries must ensure the effective protection for citizens in the country to suppress unfair competition". Therefore, the plaintiff was entitled to raise an unfair competition claim according to Chinese law.
With regard to trademark infringement, the court held that LV logo in the advertisement will not cause confusion to consumers, as one-third of the picture contains the model and the remaining two-thirds contain the advertisement message. Hence no consumer would be confused as to the identity of the building or that plaintiff has any interest in it. Hence, the defendants' actions did not constitute trademark infringement.
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