Protecting Trademark Rights in China through Litigation

Article excerpt

This note examines the potential of trademark right enforcement through commercial litigation in the People's Republic of China ("China "). The note first summarizes the current state of trademark law in China. It then illustrates, through an analysis of a number of recent suits filed by foreign companies against local infringers, the jurisprudential approach taken by Chinese courts in applying trademark law. Drawing on the above discussion and contrasting the Chinese jurisprudential approach with American courts' application of trademark law, the note concludes with practical proposals for foreign companies to adapt their trademark enforcement strategies to the legal conditions in China.

 I. BASIC STRUCTURE OF TRADEMARK LAW IN CHINA

II. LESSONS FROM TRADEMARK LITIGATION
    A. Litigate! You Have a World to Win!
    B. Make Your Marks Famous
    C. Be Creative with Threats of Suits
    D. Devise Difficult-to-Replicate Product Features and Tightly
       Control Product Distribution

III. CONCLUSION

The People's Republic of China ("China") has long been known for the rampant trademark infringement that takes place within its borders. (1) As China increasingly establishes itself as one of the largest economies and one of the biggest and most important markets, however, foreign entities hoping to protect their trademarks within China must adopt specialized strategies to meet the challenges presented by the Chinese system and by the market. This note begins by examining the structure of trademark law in China and drawing comparisons to American law. It then examines the law as applied by the Chinese courts in several trademark infringement disputes between foreign entities and local infringers, and recommends trademark enforcement and protection strategies for foreign entities operating in the Chinese market.

I. BASIC STRUCTURE OF TRADEMARK LAW IN CHINA

China's Trademark Law was adopted in 1982, (2) and experienced occasional amendments over the years, the most recent being in 2001, to meet China's treaty obligations arising from its ascension into the World Trade Organization (WTO). The law sets forth the role of the government in the area of trademarks by establishing the Trademark Office for the registration and administration of trademarks and a Trademark Review and Adjudication Board for handling trademark disputes, both under the umbrella of the State Administration for Industry and Commerce. (3) The law also sets forth the scope of the rights of the trademark owners, defines trademark infringement activities, and provides means for the owners to enforce their trademark rights. (4)

To qualify for protection under the Trademark Law, a trademark must either be registered with the Trademark Office or be famous (5) Generally, registration is granted to a trademark that has noticeable characteristics and is distinctive, (6) with a few exceptions, such as when the trademark is deceitful or discriminatory] Famous marks, on the other hand, are ones that are widely known among the general Chinese public. (8) Unlike in the United States, where similarity to a famous trademark is not a permissible basis for refusing registration during ex parte examination, (9) the Chinese Trademark Office may deny registration to marks that are reproductions of famous trademarks that have not been registered in China. (10) Parties may also apply to the Trademark Office for famous status--a process not available under American law--in the limited circumstances arising from trademark or unfair competition litigation where the fame of the mark is at issue. (11)

Both the Trademark Law and the Anti-Unfair Competition Law protect against trademark infringement (12) A party may infringe by using a mark that is the same as or similar to another's on the same or similar goods, selling goods that bear another's mark, counterfeiting another's mark, altering another's mark, or otherwise impairing another's right to use his or her mark. …