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The Trademark Infringement Case handled by Beijing IParagon Law was named
as 2015 Top 10 typical IP cases of Shanghai Independent IP Court

In August, 2015, IParagon won a trademark case for our client GUCCIO GUCCI S.P.A. which affirms that using other’s trademarks beyond proper use constitutes infringement of other’s trademark rights. Moreover, this case has been evaluated as 2015 Top 10 typical IP cases of Shanghai Intellectual Property Court in December, which has some reference value to the similar cases.

Reference Links: Moncler Official International Press Release

GUCCIO GUCCI S.P.A. v. Jiaxing Panduofu Trading Co., Ltd.
on trademark rights infringement and unfair competition (Appeal)

1. I. Brief Facts

   GUCCIO GUCCI S.P.A. has executive rights on trademarks which are used on the commodities as “GUCCI” bags and the services as demonstration of goods. Milan Company was the business manager of the Milan Square. Panduofu Company and Xinggao Company rent shops of the Milan Square, which not only sold bags including “GUCCI” ones but also highlighted “GUCCI” in their shop signs and interior decoration. Milan Company listed “GUCCI” in the exhibited brands in its official website and Sina Weibo as well as reported this news publicly. Under this circumstance, GUCCIO GUCCI S.P.A. sued Milan Company, Panduofu Company and Xinggao Company for infringing its trademark rights and conducting unfair competition, claiming that all the defendants should stop infringements and be jointly and severally liable for its economic loss of RMB one million.

2. II. Judgment

   As the trial court, Shanghai Yangpu People’s Court held that Panduofu Company and Xinggao Company sold genuine “GUCCI” commodities hence they did not infringe the plaintiff’s rights on the commodity trademarks as used on the “GUCCI” bags. However, because the two companies highlighted “GUCCI” in their shop signs and interior decoration, such acts were sufficient to confuse the relevant public and mislead them to think that there was a certain relationship between GUCCIO GUCCI S.P.A. and the shops at issue, making the two companies acquire competitive advantages which they should not have. Therefore, above acts of Panduofu Company and Xinggao Company infringed GUCCIO GUCCI S.P.A.’s exclusive rights on the trademarks used on the services as demonstration of goods and constituted unfair completion as well.
   
   Fully aware that the shops at issue were not authorized by GUCCIO GUCCI S.P.A., Milan Company not only did not stop above acts but also facilitated these shops, which also constituted such unfair competition as misleading promotion. Hence, the trial court awarded that all the defendants stop infringement and be jointly and severally liable for compensation for GUCCIO GUCCI S.P.A., specifically, Panduofu Company was responsible for RMB 30,000, while Xinggao Company was responsible for RMB 190,000, whereas Milan Company was responsible for RMB 20,000. After the trial, all the defendants appealed. In the appeal, Shanhai Intellectual Property Court dismissed the appeal and affirmed the trial decision by holding that the above three companies used the trademarks beyond the proper scope and that trial court has clarified the facts and applied the right rules.

3. III. Typical Significance

   In the instant case, on the basis of affirming the trial decision, the appeal court clarified that the sellers should use the relevant trademarks in the proper scope notwithstanding they sells the genuine commodities. To be more specific, trademark proper usage by the sellers should satisfy the following three conditions: (i) using the trademarks bona fide; (ii) not using the trademarks on the seller’s own commodities or services; (iii) using others’ trademarks merely in such necessary scopes as explaining or describing its own commodities. If the sellers do not use other’s trademarks in above proper scopes, they may still infringe others’ identical service trademarks or constitute unfair competition against others. In conclusion, the final decision of the instant case has some reference value to the similar cases.