CHATEAU LAFITE ROTHSCHILD V. TRADEMARK
REVIEW AND ADJUDICATION BOARD AND NANJING GOLD HOPE WINE INDUSTRY (2016) ZGFXZ No. 34, SPC
Cause of action: Administrative case regarding a trademark
dispute
Collegial panel members: Wang Yanfang | Qian Xiaohong | Du Weike
Keywords: connection, dispute procedure, trademark,
trademark similarity
Relevant legal provisions: Trademark Law of the People’s Republic of China (as amended in 2001),
article 28
Basic facts: In the retrial of an administrative case
of a dispute over a trademark between claimant company Chateau Lafite
Rothschild (hereinafter “Chateau Lafite”) and, as respondents, the Trademark Review and Adjudication Board
of the State Administration for Industry and Commerce (hereinafter the “TRAB”) and Nanjing Gold Hope Wine Industry
(hereinafter “Gold Hope Company”), the latter had applied to register
Trademark No. 4578349 “Chateau Lafei” (hereinafter “the disputed trademark”) on April 1, 2005. The disputed trademark
was approved for use on products falling within Class 33 of the International Classification
of Goods and Services for the Purposes of the Registration of Marks, including
wine, alcoholic beverages, fruit extracts (alcoholic), distilled alcoholic
beverages, cider, alcoholic liquid, alcoholic beverages containing fruit, rice
alcohol, highland barley alcohol and cooking alcohol, and Gold Hope Company was
registered as the owner of the exclusive right to use the trademark. The date
on which Chateau Lafite registered its trademark “LAFITE” (hereinafter “the cited trademark”) was October 10, 1996, which trademark
was approved for use on Class 33 products – that is, alcoholic beverages (except for
beers) – and Chateau Lafite held the exclusive right to use that
registered trademark./// Within the statutory time limit, Chateau Lafite filed
with the TRAB an application opposing the disputed trademark on the grounds
that it violated article 28 of the Trademark Law of the People’s Republic of China. The TRAB rendered its
Decision on Trademark No. 4578349 “Chateau Lafei” Dispute [2013] SPZ No. 55856 (hereinafter
“Decision No. 55856”) on September 2, 2013, and cancelled the
disputed trademark on the grounds that it violated article 28.
Dissatisfied with
the ruling, Gold Hope Company instituted administrative proceedings. The
Beijing No. 1 Intermediate People’s Court affirmed the TRAB’s decision.
Still
dissatisfied, Gold Hope Company lodged an appeal. At second instance, the
Beijing Higher People’s Court held that it was difficult to
affirm that the cited trademark had established a market reputation on China’s mainland before the registration date of
the disputed trademark and whether or not the relevant public was able to
distinguish the cited trademark “LAFITE” from the disputed trademark “Lafei”. The disputed trademark had been
registered and used for as long as 10 years, and it had established a stable
market position. Thus, from the perspective of maintaining that established and
stable market position, the registration of the disputed trademark in this case
was to be sustained. The Beijing Higher People’s Court therefore overruled the judgment of
the court at first instance and Decision No. 55856.
Chateau Lafite was
dissatisfied and appealed to the Supreme People’s Court. An article entitled “AQSIQ announces six kinds of imported ‘Lafite’ wines that do not conform to quality
standard”, published on China Economic Net, reported that:/// Chinese
consumers have always been enticed by “Lafite” Wines, however, recently, the
Administration of Quality Supervision, Inspection and Quarantine (AQSIQ)
announced six kinds of imported Lafite wines that did not conform to the
quality standard, which left admirers of Lafite shocked. According to China Economic
Net, the six kinds of wine products that did not conform to the quality
standard are: Chateau 拉菲 (Lafei) 2012 dry red wine …
On August 1, 2016,
Sohu Finance published an article, with text and photos, in which it reported “Chateau 拉菲 (Lafei)” making a grand appearance at China Food
and Drinks Fair and consumers unaware of it being a knockoff”///. The Supreme People’s Court ruled that the case should be
reviewed.
Held: The Supreme People’s Court delivered its administrative
judgment on December 23, 2016, overruling the judgment of the court of second
instance and affirming the judgment of the firstinstance court and Decision No.
55856.
Reasoning: The Supreme People’s Court held that the decision on whether trademarks
are similar requires consideration of the elements of the trademarks and their
overall similarity, as well as of the distinctiveness and reputation of the
relevant trademarks, and the correlation between the goods for which the
trademarks are used. Whether it is easy for the trademarks to be confusing
shall be used as the standard of judgment.
In this case, the
disputed trademark consisted of Chinese characters 拉菲庄园（“Chateau Lafei”). 庄园 (“Chateau”) has a weak distinctiveness with respect
to the wine category and hence 拉菲 (“Lafei”) is the core element of the disputed
trademark. The key to whether the disputed trademark is similar to the cited
trademark is whether 拉菲 (“Lafei”) is similar to “LAFITE” or whether the two are regularly
connected.
Before the
application date of the disputed trademark, according to the facts ascertained
by the Court, “LAFITE” had been transliterated as Chinese characters
拉菲 in
various media and news reports published in the News Express, Yangtze Evening
Post and Beijing Daily – newspapers that are easily accessible and
which have a large readership. Various media articles highly commended “LAFITE” wine and hence the cited trademark has a
high reputation. In addition, as a result of many years of commercial
operations, Chateau Lafite has established a stable objective connection
between “拉菲” and “LAFITE”, and the relevant public in China often
refers to “拉菲” as “Lafite”, so the disputed trademark is similar to the
cited trademark.
In addition, where
a trademark has been registered and used for a period of time, whether that use
has resulted in a high market reputation and a relevant consumer community is
assessed not on the basis of the period of use, but on whether the relevant
public can objectively distinguish the trademark from other trademarks in
practice. As per the facts ascertained by the Court, the relevant substandard
products reported on by various news outlets could all be identified as
products under the disputed trademark. It could also be seen from those news
reports that the relevant public had indeed confused the disputed trademark
with the cited trademark. The evidence that Gold Hope Company submitted
therefore failed to prove that a distinct relevant public for its product had
been formed as a result of its use of the disputed trademark. The second instance
court’s conclusion that the disputed trademark had established
its own stable market position had no basis in fact and the Supreme People’s Court overturned that judgment.