Armstrong case highlights problem in determining similar goods
By Kevin Nie (China IP)
Updated: 2014-01-20

The second instance court held that to determine whether goods are similar, one should undertake a comprehensive comparison based on the general public’s knowledge of related goods. The Nice Classification and the Distinction may be used as reference. Therefore, the court’s decision is consistent with the relevant provisions of the interpretations.

Judicial practices

Currently there are certain differences in the understanding and practices used by various domestic courts to determine the similarity of goods. Zhang Yazhou Said that in most cases domestic courts strictly follow the Distinction in determining the similarity of goods. Article 51 of the Trademark Law also makes it clear that the exclusive right to use a registered trademark is limited to the trademark which has been approved for registration and to the goods in respect of which the use of the trademark has been approved. Once the approved goods are clear, the basic boundaries of registered trademark rights are clear. It should be said that, in most cases, the Distinction causes no controversy in determining the product attributes, relationships and boundaries. Therefore, it is absolutely correct for local courts at all levels to identify the scope of trademark protection in accordance the Distinction. However, in some cases, if the goods are correlated, or become closely related after integration, it might be not objective to define the protection scope of a registered trademark in accordance with the Distinction , which may cause many problems.

Zhang Yazhou believed that the biggest problem for trademark infringement cases is to determine the similarity of trademarks or goods. This seemingly simple problem is actually very difficult. Therefore, different opinions exit on how to resolve this argument in practice: two similar trademarks do not lead to infringement, whereas two dissimilar trademarks do not mean non-infringement. The key to this problem lies in whether the two marks cause confusion to the relevant public.

In recent judicial practices, some courts found that the Distinction can serve as a reference point, rather than the only standard for determining the similarity of goods. Even if the cited trademark and the opposed trademark do not belong to the same international classification of goods, it does not necessarily lead to the conclusion that they are “not similar goods.”

In the trademark administrative dispute of Hangzhou Tucano Shoe Co., Ltd. v. Trademark Appeal Board & Take Seven (Holdings) Ltd., the Supreme People’s Court clearly put forward the principle of determining similar goods and provided a detailed explanation. The Supreme People’s Court held that when determining the similarity of goods in trademark disputes, controversies and subsequent infringement proceedings, courts should not mechanically and simply take the Distinction as the basis or standard. Judges should consider more practical elements and make judgments with full consideration of the circumstances of the cases. It should be emphasized that, since the determination is made on a case by case basis, the similarity of goods is not absolute or immutable and the relationship may be different from case to case based on the different facts. Related goods are often determined by the Distinction as nonsimilar, but in fact they have strong correlations and the coexistence of the two kinds of goods can easily lead to confusion. These goods should be placed under the framework of similar goods. As long as the public believes that the goods or services are provided by the same party or there is special relation between the providers, the related goods can be judged as similar goods in legal terms.

In the trademark dispute cases concluded by Beijing courts in 2012, there were a number of cases involved with the determination of the similarity of goods. In the administrative trademark case of KSS Co., Ltd. v. Trademark Appeal Board & Chen Haiting, Beijing Higher People’s Court found that the Distinction was only a reference for determining similar goods at trial. Goods classification is dynamic, and consequently courts need to judge according to the related market conditions and the general knowledge of the public. In the administrative trademark dispute of Shandong Dayu Longshen Wine Co., Ltd. v. Trademark Appeal Board & Hu Jianying, Beijing Higher People’s Court held that the examination on similar goods should not be the comparison of physical attributes, but should compare the product function, use, production entities, sales channels, and consumer groups. Courts should compare their similarity and relationship, whether the coexistence of the two trademarks can cause the relevant public to conclude that the goods are from the same provider, or there is a specific link between the providers. In the trademark appeal dispute of Ginwa (Group) Co., Ltd. v. Trademark Appeal Board & Kunming Green Valley Biotech Co., Ltd., Beijing Higher People’s Court held that the determination of similar goods should also consider the public’s awareness of the earlier registered trademark and other factors.

Thus, in addition to the Distinction, courts will also consider functions, uses, production entities, sales channels, consumer groups and related factors, as well as the reputation of earlier trademark and the coexisting relationship to identify similar goods.

Zhang Yazhou pointed out that the current trademark infringement cases showed the following trends: Firstly, well-known trademark protection has become a hot spot, which is partly caused by the goods classification of the Distinction. In some cases, the alleged infringing goods are actually related to the goods protected by registered trademarks, but the Distinction defines them as different goods. So, the right holders can only seek well-known trademark recognition and request that the Court grant cross-class protection according to the Article 13 of the Trademark Law. Secondly, in certain trademark infringement cases, the alleged infringer has a registered trademark, a design patent, or other civil rights as defense. The legal relationship in the case is more complicated. Courts must first clarify the relationship between the legal rights, and then determine which scope of claims the alleged violation falls within.

In recent years, many famous enterprises have encountered practical problems in trademark management and protection. In this regard, Zhang Yazhou noted that trademark problems appear to be trivial, but its impact is difficult to assess if handled carelessly. In recent years a number of trademark cases have caused wide concern, such as the “iPad,” “Wong Lo Kat,” “Lafite,” “JAC,” and others. From a legal sense, trademark is not equivalent to brand: brand is a management issue focusing on communication, while trademark is a legal issue with the emphasis on right authorization and protection. These two issues complement each other. However, they have their own characteristics and can not replace one another. Therefore, it is advised that enterprises should treat trademarks with the awareness of rights confirmation and protection.

(Translated by Li Guanqun)

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