Trademark Prosecution and Opposition in China

Recent Developments and Challenges

2017.11.NTD Intellectual Property Attorneys

© All Rights Reserved1

2017/12/14 NTD Intellectual Property Attorneys

A Great Wall of … Trademarks

1. Very different trademark system

2. Huge amount of filings and registrations

3. Serious bad faith filings

A Great Wall of Trademarks

3 NTD Intellectual Property Attorneys

3 parts of the Wall –

1. Very different trademark system

2. Huge amount of filings and registrations

3. Serious bad faith filings

A Very Different Trademark System

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- First to file system, filing is easy and cheap

- Use evidence or intention to use not required at and after filing

- Non-use cancellation available only after 3 years of registration

- Complicated subclass system based on Nice classification

- Registration is the King and basically no common law right

What To Do

- Find US lawyers who has experiences

- Find reliable Chinese trademark firms

Go to China Trademark Association website to find

their member firms (25K v. 500) www.cta.org.cn

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Trademark Filings 1990 - 2016

57,272

67,604

90,795

132,323

142,617

172,146

151,804

148,755

157,683

170,715

223,177 270,417

371,936 452,095

587,925 664,017

766,319 707,948 698,119

830,477

1,072,187

1,416,785

1,648,316

1,881,546

2,285,358

2,835,566

3,691,000

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

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Trademark Filings in 2016

Domestic, 3,526,827 ,

96%

Foreign, 112,347 , 3%

Madrid, 52,191 , 1%

Total:3,691,365 Trademark FilingsNo.1 in the world for 15 years

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13.2 millions Existing Registrationshttp://sbj.saic.gov.cn/sbcx/

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Headache Search

Blind Period up to 4 months

High Rate of Rejection

2016

- Total filings： 3.691 M- Filings examined: 3 M- Rejected and partially rejected: 1.2 M

Overall Rejection Rate: 40% +

2017 filing expectation：4-5M

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What To Do

- File immediately, as soon as possible

- Chinese version is extremely important

- File more times for really important marks

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A jungle with bad faith filings

- An industry of professional trademark squatters, tracing from tier 1 to tier 3 brands of any industry, especially foreign brands

- To invalidate or cancel a registration is time and money consuming

- Bad faith alone is not a sufficient legal ground to oppose or invalidate, additional elements required(prior use, prior right, contractual relationship, well-known mark, etc.)

Numbers from Beijing IP Court (from 2014.11-2017.3)

- 13558 trademark administrative litigations, 58% of all IP cases

- Cases (review on opposition and invalidation) involving bad faith filing - 30%132017/12/14 NTD Intellectual Property Attorneys

Watch and Opposition Important

2016

- Total Oppositions filed：57274- Success rate: 30%+- Heavy workload and simple ruling

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Heavy Workload -CTMO examiner – 4 opposition cases/day , 80/monTRAB examiner – 6 review/invalidation cases/day , 120/monBeijing IP Court Judge – 1.5 cases/day, 200-300/year

What To Do

Watch and Opposition Important

Total oppositions received in 2016 -

57274

Success rate: about 30% (18000)

Total review on opposition received in 2016 –

1280

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What To Do

- Copyright registration for device mark and

stylized mark - a super trademark

- Collect evidence of bad faith and bring that

to Court (22% chance to beat TRAB in Court)

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Take Away Tips- When facing bad faith filings

Be Careful – Don’t Underestimate the RiskChina is strengthening the protection on IP, punishment can be severe

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Situation SuggestionWithin 3 months of publication File opposition at CTMO

Already registered File invalidation at TRABand/or try anonymous purchase

Registered over 3 years File cancellation at CTMO for non-use

Large scale trademark squatting Government dialogue channel

Need to enter the market immediately Change your mark

IP civil actions filed to Chinese courts (first instance)

3,148 3,996 3,967 3,617 4,076 4,765 5,019 6,921 10,003 10,951 15,302

24,719 35,185

53,848 51,351 59,493

66,690

86,989

6,233 6,906

8,460

12,991

19,815 23,272 21,362

24,168

27,185

4,074 4,422

5,785

7,819

9,680 9,195 9,648

11,607

12,357

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2008 2009 2010 2011 2012 2013 2014 2015 2016

PatentTrademarkCopyrightOthers

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Recent Cases Awarded with High DamagesTrademark Infringement

• Qiang Gu Case (Beijing IP Court)

First Instance: 10 Million RMB (USD $1.5 Million) The highest damages awarded by Beijing IP Court in TM infringement case so far.

• John Deere Case (Beijing IP Court)

First Instance: 5 Million RMB (USD $0.75 Million) Fully support the plaintiff’s claims for damages

• New Balance Case （Guangdong High Court）First Instance： 98 Million (USD $14.5 Million) Second Instance：5 Million (USD $0.75 Million)

• New Balance Case （Suzhou intermediate Court）First Instance： 10 Million RMB (USD $1.5 Million)

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Thank You !

Any Questions?

christopher.shen@chinantd.com

TEL: 8610-63611666FAX: 8610-6621 1845

NTD Intellectual Property Attorneys