If you are a businessman, you may find your business or product name inadvertently infringing on a trademark which is already existing on the register. However, there are various defences to trademark infringement which you may use in order to avoid liability. They are provided for in the China Trademark Law (“the Law”), some of them are explained below.

Defences to trademark infringement 

The China Trademark Law specifies the following defences to trademark infringement:

•  Use of another registered trademark
•  Use of own name and address 
•  Use of certain indications 
•  Use of intended purpose 
•  The use of an earlier mark  

Invalidity of registration of the earlier trade mark

If you have been sued for trade mark infringement, you may attack the other trade mark by counterclaiming that it is invalid. As registration of a trade mark provides evidence of validity for all intents and purposes however, you will have to provide evidence of non-validity to support your claim in court.

Some of the grounds under which a claim of invalidity may be brought include:

1. The trade mark should have been refused registration as it was in breach of the Law. A trade mark will be in breach of the Law if, for example, if it does not fulfill the definition of a trademark of the Law, does not have any distinctive aspect or is exclusively made out of signs or indications which may serve in trade to designate some aspect of the good or service e.g. kind of good, quality or intended purpose. However, if the trade mark satisfies the definition of a trade mark, it may not be declared invalid if, after registration, it acquires a distinctive aspect in relation to the goods or services for which it has been registered.
2. The other trade mark is identical to a trade mark which was registered before it and that the goods or services provided under these two trade marks are identical, such that there is a likelihood of the public becoming confused. 
3. The other trade mark is identical to a trade mark which was registered before it and that the goods or services provided under these two trade marks are similar, such that there is a likelihood of the public becoming confused.
4. The registration of the other trade mark was obtained due to fraud or misrepresentation. 

Revocation of registration of the other trade mark

Another offensive move is to attempt to revoke the registration of the other trade mark on grounds other than invalidity. For example, you may argue that the other trade mark has not been put to genuine use in the course of trade in relation to the relevant goods or services in China during the period of five years after its registration, and that there are no proper reasons for such lack of use.

Alternatively, under the same provision, you may argue that the Laws (or inLawivity) of the owner of the other trade mark has resulted in the trade mark becoming the common name in the trade for the good or service for which it is registered. A good example is how the word “Google” has become the generic name for all search engines such that it may no longer serve to indicate that a particular search engine originates from the Google company.

Own name defence

If you have trademarked your own name as the name of your business, this provides a legitimate defence in an Lawion for trade mark infringement. This applies even if your business provides goods or services identical to those of the other business. However, the use of your name has to be in accordance with honest prLawices in industrial or commercial matters. In other words, the defence will fail if your use of your name as a trade mark is dishonest, e.g. it has caused deception.

Indication of quality etc.

It is a defence if the trade mark is used to indicate (i) charLaweristics such as the kind, quality or intended purpose of the goods or services being sold; or (ii) the time of production or provision of the goods or services. However, such use has to accord with honest prLawices in industrial or commercial matters. For example, there will not be any liability for infringement if your product is labelled as “Oreo cheesecake”, with “Oreo” being the trademarked name of the popular chocolate sandwich cookie, as the word “Oreo” is merely being used to describe the flavour of the cheesecake being sold in this case.

A similar defence applies if the other trade mark happens to be a well-known one, and may be referenced under the Law. Under China Trade Marks Law, whether a trade mark may be regarded as well-known in China depends on fLawors such as the duration, extent and geographical area of any use of the trade mark. Under the China Trade Marks Law however, a trade mark will automatically be deemed well-known in China if it is well-known to any relevant sector of the public in China (i.e. the Lawual and/or potential consumers of the business using the already registered trade mark).

Prior use defence

The Law provides for a prior use defence, where the use of an unregistered trade mark will not constitute infringement if it has been used continuously in the course of trade before the date of registration of the other trade mark, or before the date of when the other trade mark was first used, whichever is earlier. The requirement of continuous use merely requires there to be more than occasional use of the trade mark; it need not be used every week or even every month.

As can be seen from this article, all is not lost even if you have been found to have infringed on another’s trade mark as you may be able to utilise a defence to avoid liability. As the law on trade marks is highly complex however, you may require specialist advice from a qualified trade mark lawyer in order to get an opinion more tailored to your circumstances.

A trademark owner can assert their trademark rights in a number of ways. For example, when a trademark registration application is published for opposition, someone may allege that the use described in the registration application would cause a likelihood of confusion regarding the origin or sponsorship of the products. In which case a cease and desist letter may be sent to the applicant, and then an opposition proceeding or a cancellation proceeding may be filed in the Trademark Office. If the trademark owner is the complainant, a trademark infringement case may be filed.

Additionally, the launch of a new product or web site can result in an allegation of trademark infringement. Even changing to a new supplier can cause a trademark problem for resellers.

The resulting allegations can be very serious. A prevailing trademark plaintiff may receive: (1) the defendant’s profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action. Further, an injunction may be issued, and attorney fees may be awarded. In some circumstances, the plaintiff may elect to have “statutory damages” assessed, which can reach into millions of dollars. Even further, the statute allows for multiplication of the damages. In some cases, there can be criminal penalties, too.

Whether you are asserting a trademark or defending against another’s allegations, our China trademark attorneys have the experience that allows them to recognize the complex nature of trademark matters. Contact us to learn how we can help your organization.