This case is typical in that it invalidated bad-faith registration through applying “Where the trademark of an identical or similar kind of goods is a reproduction, imitation, or translation of another person's well-known trademark not registered in China and is liable to cause public confusion, no application for its registration may be granted and its use shall be prohibited.” as provided in China’s Trademark Law. In this case, the reference mark, the Nike Swoosh was affirmed as a well-known trademark, and its protection scope was extended in accordance with Paragraph 2, Article 13 of Trademark Law. A precedent ruling of Beijing High People's Court was also referenced to support the ruling of this case.

Case Details

Quanzhou Luojiang Chaosheng Shoes Limited (LCS) filed an application for the registration of No. 3275213 Figure trademark (the dispute trademark) before China’s Trademark Office on August 15, 2002. The trademark was approved of its registration on July 14, 2005 and was designated on the use of goods of Class 25 including “clothing, shoes, ties, socks and belts”. After renewal, the trademark is allowed to be used until July 13, 2025. Nike, Inc. (Nike) filed an invalidation request against the TM on May 23, 2014 before TRAB on grounds that: Nike asked to recognize the No.991722 trademark (reference TM) as a well-known trademark on the use of goods of Class 25; and the registration of the dispute trademark is reproduction and imitation of Nike’s famous TM. On March 30, 2015, TRAB rulled to maitain the dispute TM.

Unsatisfied with the result, Nike brought the case to court, holding:

1. the evidence as provided by Nike was sufficient to prove the reference TM is popular enough to be regarded as a well-known TM; and  

2. despite knowing clearly the existence of Nike and its famous design logo, LCS sought to profiteer by taking advantage of the good reputation and high popularity of Nike and its TM, which constituted bad faith and shall be prohibited by Article 13 of Trademark Law.

Therefore, Nike requested the dispute TM be invalidated and TRAB’s Descartes be overruled.

TM Designs

Summary of the ruling

After hearing the case and based on the evidence already provided, the court held that the reference TM had already been popular enough in goods of “clothing, shoes and hats, etc” to be regarded as a well-known TM before the dispute TM was registered. The relevant public of the designated goods of the dispute TM should know the existence of the Nike Swoosh. Under such circumstances, it would create confusion among relevant consumers as to the source of goods if the dispute TM should be allowed to be used. In addition, after Nike’s use and publicity, the reference TM formed a sole correspondence with Nike. The third party’s use of the dispute TM took a free ride of the reference TM’s market reputation and reaped the benefits of Nike which were the result of the latter’s hard work and heavy investment, violating Nike’s legal rights and interests. The court therefore ruled that the dispute TM shall be invalidated.