by Feynman LIANG, Patent & Trademark Attorney

Trademark squatting in China has been a long time issue for many domestic and international brand owners. Trademark law has been amended recently in April to further address the issue by including “any bad faith application for trademark without intent to use shall be dismissed” into Article 4 of the Trademark Law. Before the implementation of the amendment ( which will be implemented from November 1, 2019) and further interpretation of the amended portion, we continue to see successful stories of brand owners such as Carl Zeiss AG in fighting against trademark squatters.

The story went back a few years ago when Carl Zeiss AG noticed that a few related entities targeted the German company and filed at least 80 applications before China Trademark Office. These applications were filed by Company B, Company C and Mr. A. As indicated in the business registration system, Mr. A is the shareholder of above mentioned companies. The applications at issue are related to the word marks “ZEISS”, “CARLZEISS”, “蔡斯” (Official Chinese transliteration and brand name of Zeiss), “卡尔蔡司” (Official Chinese transliteration and brand name of Carl Zeiss), its device marks etc. Carl Zeiss AG filed multiple oppositions and invalidation petitions against the applications and the registered marks.

Mr. A’s application list

Company B’s application list

Company C’s application list

Recently, China Trademark Office made decisions on 47 oppositions raise by Carl Zeiss AG and decided that the applications should be rejected on the following grounds

1. Evidence submitted by Carl Zeiss AG indicated that the mark has gained high reputation and formed a close link to the product provider through long term use and extensive promotion.

2. The marks in the application at issue are identical or similar to the wording of Carl Zeiss AG’s registered marks.

3．The applicant purposely copied and imitated the opponent’s mark with bad faith. If registered, the marks at issue are likely to cause confusion on the source of goods among related public.

Besides the marks or applications at issue, the applicants also filed multiple applications with marks of other international brand owners such as Siemens, Euclid, Essilor, Abbott etc. Submitting filing history of the applicant(s) has been proved to be very helpful in opposition and invalidation for the examiner to have better understanding of applicant’s intention of registration.

Regarding the invalidation case (mark “zeiss” held by Company C), the petition of invalidation was previously filed before the Trademark Adjudication Board (TRAB) but the mark was held to be valid by TRAB in 2018. Carl Zeiss AG was not satisfied with the decision and filed an administrative lawsuit against TRAB before Beijing IP Court. On May 29, 2019, Beijing IP Court issued a judgment in which TRAB’s decision regarding the validity of the mark should be cancelled. The court found that that Company C’s mark registration is an act of freeriding on the good reputation of the well known company and its trademark. Such act not only infringed the exclusive trademark right of Carl Zeiss AG’s, but also damaged the order of trademark registration system as set forth in Article 44 of the Trademark Law of P. R. China

Article 44. Where a trademark registration violates the provisions of Articles 10, 11, and 12 of this Law, or the registration of a trademark was acquired by fraud or any other improper means, the Trademark Office shall invalidate the registration at issue. Any organization or individual may request that the Trademark Review and Adjudication Board make a ruling to invalidate such a registered trademark.

Therefore, the validity decision of TRAB should be cancelled.

For brand owners, negative decision from TRAB or Trademark Office may not mean the end of the day. Successful cases in recent years indicate that as the law and the policy changes, it would be easier for brand owner to guard their brand against trademark squatters. If the Chinese market is sufficiently important and if the evidence is reasonably strong, it would be worthwhile to appeal the case further.