A case involving a dispute over trademark infringement between the appellant Beijing Neiliansheng Shoes Co., Ltd. and the appellee Hangzhou Bianfumao Shoes Co., Ltd.

Zhejiang Provincial Higher People’s Court 2009) Zhe Zhi Zhong Zi No. 48

The appellant (plaintiff in the original trial) Beijing Neiliansheng Shoes Co., Ltd. is domiciled at No. 34 Dashilan Street, Xuanwu District, Beijing.

Legal representative Cheng Laixiang, chairman of the board.

The authorized agent (specially authorized agent) is Li Jie, a lawyer at Beijing Gaobo Longhua Law Firm.

The appellee (defendant in the original trial) Hangzhou Bianfumao Shoes Co., Ltd. is domiciled at No. 110, Zhongshan Middle Road, Shangcheng District, Hangzhou City, Zhejiang Province.

Legal representative Fu Jianqiang, general manager.

The authorized agent (specially authorized agent) is Lou Qi, a lawyer at Zhejiang Wulian Law Firm. The appellant Beijing Neiliansheng Shoes Co., Ltd. (hereinafter referred to as Neiliansheng Company) was dissatisfied with the civil judgment (2008) Hangmin Sanchuzi No. 289 of Hangzhou Intermediate People's Court of Zhejiang Province due to a dispute over trademark infringement. Appeal to this Court. After the court filed and accepted the case on February 18, 2009, it formed a collegial panel in accordance with the law, and held a public hearing on April 21 of the same year. Lou Qi, the authorized agent of Bian Fumao Co., Ltd. (hereinafter referred to as Bian Fumao Company), attended the court to participate in the litigation. The case has now been concluded.

The original judgment found that on March 1, 1979, Neiliansheng Shoe Store in Xuanwu District, Beijing obtained the word trademark "Neilianshengpai" with registration number No. 125412 (the approved trademark logo was "Neilian Sheng (Traditional Chinese)"), the approved product is Category 54 (shoes), and the validity period is from March 1, 1979 to February 28, 1989. After repeated approval by the Trademark Office of the State Administration for Industry and Commerce, the renewal registration of the trademark No. 125412 "Neilian Shengpai" is valid until February 28, 2013. On December 7, 1998, with the approval of the Trademark Office of the State Administration for Industry and Commerce, the name of the registrant of trademark No. 125412 was changed to Beijing Neiliansheng Shoe Store. On July 21, 2004, upon approval, the name of the registrant of Trademark No. 125412 was changed to Neiliansheng Company. On August 20, 2007, the State Administration for Industry and Commerce recognized the registered trademark "Neiliansheng" used by Neiliansheng Company on Class 25 commodities as a well-known trademark. In addition, the "Neiliansheng" brand used by Neiliansheng Company has been recognized as a Chinese time-honored brand by the Ministry of Commerce. On June 28, 2006, Neiliansheng Company was recognized as "the first company of cloth shoes in China" by the Office of China Commercial Brand Management Committee. A variety of cloth shoes produced by Neiliansheng Company were selected as the ceremonial shoes for the 29th Beijing Olympic Games. On February 25, 2008, under the on-site notarization by the notary of the Dongfang Notary Office in Hangzhou City, Zhejiang Province, Neiliansheng Company entrusted agents at No. 110 and 186 Zhongshan Road, Hangzhou City, and No. 160 Xinhua Road, Hangzhou City (respectively, the margins Mao Company headquarters, first branch and second branch) purchased three pairs of "Neiliansheng" cloth shoes (unit price 210 yuan). The cloth shoes and the attached certificates are marked with the "Neiliansheng (Traditional)" logo and the inner The name of Liansheng Company, the address and contact number of Liansheng Company are also marked on the product certificate. Bianweimao Company uses the "Neiliansheng (Traditional)" logo at the entrance of its headquarters and second branch for advertising. On March 12 of the same year, the Hangzhou Administration for Industry and Commerce conducted an inspection on the headquarters, first branch, and second branch of Bianwamao Company in accordance with the law based on the report of Neiliansheng Company, and seized 35 pairs of cloth shoes marked with the "Neiliansheng" trademark on site. , worth 8,390 yuan, and found that Bianwamao Company used the "Neiliansheng" logo on its store for advertising. Hangzhou Municipal Administration for Industry and Commerce entrusted Neiliansheng Company to appraise the trademarks of the 35 pairs of cloth shoes seized and the three pairs of shoes notarized and purchased by Neiliansheng Company. After the appraisal, Neiliansheng Company issued a written appraisal certificate, believing that The trademarks on the above products are all counterfeit registered trademarks.

On May 4 of the same year, the Hangzhou Administration for Industry and Commerce issued a penalty decision No. 61 [2008] Hangzhou Gongshang Guangchuzi [2008] No. License, unauthorized use of the "Neiliansheng" trademark for advertising is an infringement of the exclusive rights to the registered trademark; at the same time, Bianbomao Company's behavior of selling shoes that infringes the exclusive rights of the "Neiliansheng" registered trademark is also an infringement of the exclusive rights to the registered trademark behavior.

It was decided to impose the following penalties on Bianbomao Company: 1. Order to immediately stop the infringement; 2. Confiscate the above 35 pairs of infringing shoes; 3. Fine 3,860 yuan. This administrative penalty has taken effect.

The original judgment also found that Neiliansheng Company and Bianwamao Company had a cooperative relationship from 2004 to 2006. Bianwamao Company distributed Neiliansheng Company’s footwear products, and Bianwamao Company directly purchased the products from Neiliansheng Company. Purchased from Liansheng Company. In May 2006, Neiliansheng Company set up a specialty store in Hangzhou, and Neiliansheng Company stopped cooperating with Bianwaimao Company and no longer shipped goods to Bianwamao Company. During the court hearing, Neiliansheng Company confirmed that its operators include franchisees and general dealers. The former can use the Neiliansheng Company plaque, while the latter can only sell and has no right to use the Neiliansheng Company name and its logo. Both dealers and franchisees can only purchase goods directly from Neiliansheng Company.

On July 22, 2008, Neiliansheng Company filed a lawsuit with the court of first instance on the grounds that Bian Fumao Company’s actions constituted trademark infringement and unfair competition, requesting an order that Bian Fumao Company: 1. Immediately stop trademark infringement Infringement and unfair competition. 2. Make a public apology and destroy all inventory of infringing products. 3. Compensate him with 500,000 yuan. 4. Bear the necessary expenses of 50,000 yuan to stop the infringement. 5. Bear the litigation costs of this case.

The court of first instance also found that Neiliansheng Company paid 50,000 yuan in agency fees and 1,328 yuan in purchase fees for the accused products in this case.

After hearing, the court of first instance held that Neiliansheng Company is the exclusive owner of the registered trademark No. 125412 "Neilianshengpai" involved in this case. The trademark is still within the protection period and has legal status. Stable, its trademark exclusive rights should be protected by law. A trademark is a visible sign used on certain goods or services to distinguish the goods and services of a natural person, legal person or other organization from the goods and services of others. Therefore, a trademark is a sign that directly represents the different sources of goods, and its fundamental purpose and basic function is to identify and distinguish the source. In this case, Bianbomao Company marked the text "Neiliansheng" in a prominent position on the door of its store. This mark has played a guiding role in guiding consumers to identify the manufacturer of the product, and its function of distinguishing the source of the goods has been fully achieved. The expression is a trademark. According to Article 3 of the "Regulations for the Implementation of the Trademark Law of the People's Republic of China": "The use of trademarks as referred to in the Trademark Law and these Regulations includes the use of trademarks on commodities, commodity packaging or containers, and commodity transaction documents, or the use of trademarks on commodities, commodity packaging or containers, and commodity transaction documents, or the use of trademarks The trademark is used in advertising, exhibitions and other commercial activities.” It can be seen that Bianmao Company uses the “Neiliansheng (Traditional)” logo to advertise the footwear products it distributes without the permission of the trademark owner. It is easy for the relevant public to misunderstand the source of the goods or think that the source has a specific connection with the goods with the registered trademark "Neiliansheng", which falls under Article 52, Paragraph 1 of the Trademark Law of the People's Republic of China. "Using a trademark that is identical or similar to the registered trademark on the same or similar goods without the permission of the trademark registrant" violates the exclusive right to use the registered trademark No. 125412, and Bianbomao Company shall bear the consequences arising therefrom. Liability for tort. Bianbomao Company's defense that its use is fair and does not constitute infringement lacks corresponding legal basis and will not be supported.

At the same time, Bianbomao Company sells cloth shoes with counterfeit "Neiliansheng" registered trademark, which also falls under Article 52, Paragraph 2 of the "Trademark Law of the People's Republic of China" "Sales of infringement of registered trademarks" "Products with exclusive rights" refers to infringement of the exclusive rights of registered trademarks. Accordingly, Neiliansheng Company's request to Bianbanmao Company to stop infringement, compensate for losses, and destroy all inventories of infringing products is well-founded in law and will be supported. Since Bianwamao Company’s use of the “Neiliansheng” trademark for advertising in the stores it operates has already been judged in the aforementioned trademark infringement determination, Neiliansheng Company also accused it of unfair competition based on the same infringement fact. Behavioral requests will not be supported. Regarding Neiliansheng Company’s request for an apology from Bianwamao Company, since trademark rights do not have the nature of personal rights, and an apology is a remedy when personal rights are infringed, Neiliansheng Company’s request will not be supported.

As for Bianbomao Company’s defense that as a seller, it does not need to bear compensation liability, the court of first instance held that, on the one hand, Bianbomao Company did not provide effective evidence to prove that the infringing products it sold were obtained legally and could explain supplier; on the other hand, as a former dealer of Neiliansheng Company, Bianbanmao Company knew and should know that the products of Neiliansheng Company it sold should be purchased directly from the company, but Bianbanmao Company was in conflict with Neiliansheng Company. After terminating the distribution relationship, it still sells goods of unknown origin and counterfeiting the "Neiliansheng" registered trademark in the name of Neiliansheng dealers, which shows that Bianbimao Company subjectively takes a laissez-faire approach to its sales infringements. This situation obviously does not fall within the situation of "selling goods that are not known to infringe the exclusive rights of registered trademarks" in Article 56, paragraph 3, of the Trademark Law of the People's Republic of China. Therefore, Bianbomao Company believes that its claim that as a seller should not be liable for compensation lacks corresponding factual basis and will not be supported.

As for the amount of compensation, because Neiliansheng Company did not provide the court of first instance with effective evidence to prove the specific losses it suffered due to the infringement during the period of infringement or the specific benefits the infringer gained due to the infringement during the period of infringement, Bianpaimao Company has also not provided the sales volume and sales profits of its infringing products, so the specific profit amount from its infringement cannot be determined. In view of the difficulty in determining the interests of the infringer and the losses of the infringed party, the court of first instance used statutory compensation to determine the amount of compensation, taking into account various factors, including the popularity of the registered trademark "Neiliansheng" involved in the case, the nature, scope, time, and Factors such as the method of infringement and the reasonable expenses incurred by Neiliansheng Company to stop the infringement shall be determined as appropriate.

To sum up, the court of first instance decided in accordance with Article 118 and Article 134 (1) and (7) of the "General Principles of the People's Republic of China and Civil Law" , Item (9), Article 52 (1), (2), Article 56 of the Trademark Law of the People's Republic of China, "On the Application of the Supreme People's Court's "On the Trial of Trademark Civil Dispute Cases" According to the provisions of Articles 16 and 17 of "Interpretation of Certain Legal Issues" and Article 64 of the "Civil Procedure Law of the People's Republic of China", the judgment was made on December 15, 2008: 1. Bian Fumao Company Immediately stop using the "Neiliansheng" logo that infringes the exclusive rights of the registered trademark No. 125412 "Neilianshengpai" in the stores it operates.

2. Bian Fumao Company immediately stopped selling products that infringed the exclusive rights of the registered trademark No. 125412 "Neilian Shengpai" and destroyed all infringing products in stock. 3. Bian Fumao Company shall compensate Neiliansheng Company for economic losses of 80,000 yuan (including the reasonable expenses incurred by Neiliansheng Company to stop the infringement), and shall complete the performance within ten days from the date when the judgment takes effect. 4. Dismiss Neiliansheng Company’s other claims. If the monetary payment obligation is not performed within the period specified in the judgment, the debt interest for the period of delayed performance shall be doubled in accordance with the provisions of Article 229 of the Civil Procedure Law of the People's Republic of China. The case acceptance fee was 9,300 yuan, of which 5,326 yuan was borne by Bian Fumao Company and 3,974 yuan was borne by Neiliansheng Company.

After the verdict was announced, Neiliansheng Company was dissatisfied and appealed to this court.

Neiliansheng Company appealed and stated: First, the court should recognize all the evidence submitted by its company regarding rights protection expenses, and this part of the expenses should be borne by Bian Fumao Company; secondly, Bian Fumao Company intentionally infringed, Moreover, the infringement lasted for a long time, had a large scope, was egregious in nature, and had serious consequences. Therefore, the infringement liability should be borne corresponding to the infringement liability. The amount of infringement compensation determined by the original judgment was obviously too low. Based on this, we request this court to change the third item of the original judgment and order Bian Fumao Company to compensate for economic losses of 500,000 yuan and reasonable expenses to stop the infringement of 50,000 yuan, totaling 550,000 yuan; to order Bian Fumao Company to bear all the costs of the first instance. Litigation costs; it was judged that Bian Fumao Company should bear the appeal costs of this case.

Bian Fumao Company argued that Neiliansheng Company’s appeal had no factual and legal basis and should be rejected.

In the second trial, neither party provided new evidence. This court confirmed the facts found in the original judgment.

In response to the appeal request and reasons of Neiliansheng Company and the defense opinions of Bian Fumao Company, this court believes that the focus of the dispute in this case is whether the amount of damages determined by the original judgment is appropriate.

The first and second paragraphs of Article 56 of the Trademark Law of the People's Republic of China stipulate: "The amount of compensation for infringement of the exclusive right to use a trademark shall be the amount of compensation suffered by the infringer due to infringement during the infringement period." The benefits obtained by the infringed party, or the losses suffered by the infringed party due to the infringement during the infringement period, include the reasonable expenses paid by the infringed party to stop the infringement, or the benefits gained by the infringed party due to the infringement mentioned in the preceding paragraph. If the loss suffered by the infringement is difficult to determine, the people's court shall award a compensation of less than 500,000 yuan based on the circumstances of the infringement. "Article 16, 2, of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Trademark Civil Disputes. Paragraph stipulates: “When determining the amount of compensation, the people’s court shall consider the nature, duration, and consequences of the infringement, the reputation of the trademark, the amount of the trademark license fee, the type, time, and scope of the trademark license and the reasonable expenses to stop the infringement. "First of all, regarding the issue of evidence validity, the original judgment only identified the parts related to Wang Zhengzhi of Evidence 10, notarization fee invoice and Evidence 11, submitted by Neiliansheng Company, because Wang Zhengzhi was involved in the notarial certificate application. The person's authorized agent has a connection with the relevant bills and this case, but the name and content shown on other bills cannot reflect the connection between him and this case, so there is nothing wrong with the original judgment not recognizing it.

Secondly, the factors for determining damages mentioned by Neiliansheng Company in the appeal include that the trademark involved is a well-known trademark in China, Bian Fumao Company intentionally infringed, the infringement was wide in scope, time-consuming, and profitable, and The company’s enforcement fees. When determining the amount of damages, the court of first instance took into account many factors, including the popularity of the trademark involved, the nature, scope, time, manner of infringement, and the reasonable expenses incurred by Neiliansheng Company to stop the infringement. As for the lawyer's fee of 50,000 yuan, it is not inappropriate for the original court to support the reasonable part based on the lawyer's charging standards, lawyer's workload, case difficulty, petition support ratio, court litigation fee collection, etc.

To sum up, the appeal request and reasons proposed by Neiliansheng Company lack factual and legal basis, and this court will not support it. The facts found in the original judgment were clear, the law was applied correctly, and the substantive handling was appropriate. The appeal was dismissed and the original judgment was upheld. The second-instance case acceptance fee is 8,350 yuan, which is borne by Neiliansheng Company.

This judgment is final.

Presiding Judge Ying Xiangjian

Acting Judge Chen Dingliang

Acting Judge Lin Meng

May 10, 2009 Nine Days

Secretary He Qiong

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