To the letter

Automaker DaimlerChrysler AG has collided with a China-based health products company, Vitop Bioenergy Co Ltd, as both companies claim a similar trademark.

Vitop Bioenergy met opposition from DaimlerChrysler when it tried to register its trademark "Vitop" in a vehicles and carriers category for trademark registration.

The German company claims that the Vitop trademark violates its rights to "Vito", a Mercedes-Benz trademark for a van.

The auto conglomerate last May consigned a Beijing trademark agency asking the State Administration for Industry and Commerce to remove the initial validation of the trademark Vitop, when it was selling controlling stake of Michigan-based Chrysler to private equity firm Cerberus.

Vitop Bioenergy held a press conference in early December in response to the German giant's opposition, claiming that it will spare no efforts to defend its trademark.

It is the first time a well-known trademark authorized by the departments of industry and commerce has been at the center of a dispute.

Vitop Bioenergy applied to the State Administration for Industry and Commerce to register its Vitop trademark in the 12th category - usually reserved for motor vehicles and auto parts - at the end of 2004 and passed its initial validation in February 2007. The administration received formal opposition papers from DaimlerChrysler last July and submitted the protest to Beijing Boss and Young Patent and Trademark Attorneys Co Ltd, the trademark agent for Vitop Bioenergy.

As the Trademark Law stipulates the principle of priority, the registration date is at the core of the dispute.

DaimlerChrysler notes its trademark Vito was registered on November 9, 1995, when the firm introduced the van in Spain and Portugal. However, the Chinese company says its trademark Vitop was registered in Malaysia as early as in 1993.

Wu Jiang, legal advisor of Vitop Bioenergy, says that the company applied for trademark rights for Vitop in 1990s, received approval, and DaimlerChrysler did not oppose it. In the latest application the Chinese company sought to make some changes to the appearance of its trademark - and DaimlerChrysler objected.

"The reason might be that the carmaker did not sell its Vito vehicles in China in the 1990s," he says, adding that the company brought them to Chinese customers in 2003 .

DaimlerChrysler claims that the similarities between Vito and Vitop could mislead consumers, as their pronunciations are almost identical, with the last sound "p" of the last letter of Vitop not emphatic. The German company also says it is difficult to differentiate the two trademarks as they do not have any specific meaning.

Vitop Bioenergy claims obvious differences between the marks. The company says the last letter "p" can be obviously be heard when pronounced. It says Vitop is the acronym for "Vitality Is Theme Of People", which is in line with the company's core business. The trademark also implies the company's ambition to rank at the top in the health product industry.

"Our trademark is a combination of English letters and graphics, while DaimlerChrysler's trademark only consists of four capitalized letters," Wu points out.

"Vitop was recognized as a Chinese top brand and well-known trademark in 2005 and also one of China's Top 10 credible healthcare brands in 2006," Wu says.

According to international rules, trademarks recognized as top and well-known in China are protected by laws at home and abroad.

In its opposition filing, DaimlerChrysler says that the company has devoted huge resources and energy to publicize its trademark, which has become popular in the Chinese auto market.

DaimlerChrysler's trademark was approved in the vehicle and parts category.

Founded in 1992 in Zhuhai, a coastal city in South China's Guangdong Province, Vitop Bioenergy has experienced rapid growth in the past decade with its core products of mattresses, bedding and water purifiers. It was listed in Hong Kong in 2003.

It is the first time for the firm to confront opposition from a multinational company, although it has had other kinds of IPR disputes with local companies .

"Our reasons are soundly grounded this time, and we are not afraid of any trademark dispute," Lu Genxin, chief operating officer of Vitop Bioenergy, said during the press conference in December.

Vitop Bioenergy is one of a handful of companies in China that have received all the designations as a top brand, well-known trademark and national inspection-free product.

The company received a written notice from the State Administration for Industry and Commerce on October 11 and submitted its statement in defense to the commission on November 6.

The commission could make a judgment on the case in three months, but it could take one to two years to go through all the legal procedures.

Wu reveals to China Business Weekly that the current trademark opposition has no negative impact on the company's operations in both domestic and overseas markets.

He adds that the dispute will not pose a financial burden to the company, as the company believes it will not need to make any compensation.

He does not rule out the possibility that Vitop Bioenergy would move into the automobile industry. He says that the company focuses on developing and producing personal care products and contends automobile products are included in the category.

In contrast to Vitop Bioenergy's high profile, DaimlerChrysler remains tight-lipped at the moment.

Since China's entry into the WTO, there are an increasing number of IPR and trademark conflicts, and many local companies choose to withdraw when faced with international big names.

Trademark experts suggest that Chinese companies should make specific investigations through various channels before they register their trademarks to avoid unnecessary disputes and cost.

They also stress that Chinese companies should be resolute in using the law to defend their trademark rights once disputes arise.

Editor's note: The IPR Special is sponsored by the State Intellectual Property Office and published by China Business Weekly. To contact the Intellectual Property Office, the IPR Special hotlines are 8610-64995421 or 8610-64995826, and the e-mail address is ipr@chinadaily.com.cn.

(China Daily 01/05/2008 page9)