(By You Yunting)Maotai, a well-known Chinese baijiu (the classic Chinese alcohol made from distilled sorghum that averages an alcohol content from of 53 percent), is made in Maotai Town, Huanren city in Guizhou Province. In Maotai town, there are many liquor factories but only the KWEICHOW MOUTAI CO., LTD (the “MOUTAI”) holds the “贵州茅台酒” trademark (the “disputed trademark”). On account of “Maotai” brand name glamour, such free riders likeother liquor factories’ use of the disputed trademark often happen. We would like to introduce a typical case regarding that Guizhou Ronghe Shaofang Wine Business Limited Company used a same bottle label and packaging with that of Maotai Wine but carries its “荣和”（pronounced “Ronghe” in English）brand in our today’s post. The final binding judgment contained by Beijing No.2 Intermediate People’s Court decided that such act of using the same bottle label and  packaging constituted trademark infringement.

Introduction to the Case:

Plaintiff: KWEICHOW MOUTAI CO., LTD (the “MOUTAI”)

Defendant: Guizhou Ronghe Shaofang Wine Business Limited Company (the “Ronghe Wine Company”)

Court of First Instance: Fengtai District People’s Court of Beijing

Court of Second Instance: Beijing No.2 Intermediate People’s Court

MOUTAI holds the combination trademark “贵州茅台酒” (the “disputed trademark”) of Chinese characters and pattern design numbered 284526. The disputed trademark, once judged the first Chinese well-known trademark, enjoys a highly popularity and brand reputation in China. In 2011, law enforcement seized some group of wine called “百年荣和老窖”(the “disputed goods”as shown in the second figure) made by Ronghe Wine Company. MOUTAI brought a lawsuit to the courts, alleging that Ronghe Wine Company’s use of such pattern design infringed its exclusive right to its registered trademark, i.e., the disputed trademark.

The case was heard by two courts, ending in the judgment that Ronghe Wine Company constituted infringement.

The court of first instance heard the case and held that the pattern design of thedisputed goods wholly constituted similar mark to that of the disputed trademark. Moreover, despite that relevant public may not confuse with the two goods, they are likely to mistakeforsuch a certain relationship asan authorized license or capital investment between Ronghe Wine Company and MOUTAI.

The court of second instance affirmed the judgment of the first instance and furtherdecidedas follows: first, the pattern design of the disputed goods obviously carries the words of  “百年荣和老窖酒” and marks its enterprise name at the bottom of the package so as to attract relevant public’s attention on distinguishing the two wine goods; Second, even though, its bottle label and packaging are wholly identical with the over-all structure of the disputed trademark and similar to theintegral pattern design of the disputed trademark owned by MOUTAI. Third, such identical structure and similar pattern design would efficiently inspire consumers’initial purchase interests and possibly cause confusion of a certain relation between the two liquor factories. Lastly, such identical structure and similar pattern design would clearly indicate Ronghe Wine Company’s intention of attaching itself to MOUTAI’s reputation. Therefore, the court of second instance determined that Ronghe Wine Company constituted infringement.

Lawyers’ Comment:

1.      Why do different words still constitute similar trademarks?

The highlight in this case is that Ronghe Wine Company obviously marked the characters “百年荣和老窖酒” on its disputed goods and its enterprise name at its bottom, thus the package of the two wine goods can be distinguished. In our opinion, although the two goods can be distinguished from each other, possible potentials of confusion of the source of the two goods are also existed because the two trademarks are similar to each other towards the design composition, colors and the wholly pattern design’s structure, except the difference in words’character pattern, pronunciation and meaning. Therefore, it is likelihood of the consumers that may confuse the source of the goods or services.

For trademark similarity, the principle of Chinese laws and regulations centers upon the general attention of relevant consumers.The criterion for comparison of trademark similarity may rely on the trademark as a wholeand the major parts of the trademark. Such comparison shall be undergoing under an isolated conditions. To judging whether the two trademarksaresimilarto each other shall take consideration into the distinctiveness and popularity of the protected trademark. In this case, where the disputed trademark enjoys immense popularity, when the disputed goods are similar in the package’s structure and colors and pattern design as a whole to those of MOUTAI, consumers of white wine may create an impression of connection between the two wine goods during his purchase.This is the basis of infringement judgment.

2.      Why not constitute industrial design infringement?

Considering the two wine goods are similar to each other, the proper method of intellectual property protection shall be design protection. Pursuant to the Patent Law, the validity period of a patent right for design shall be ten years. The package of MOUTAI had been used for decades, which had already exceeded the protected validity period of a patent right for design. Therefore, MOUTAI only use the trademark to protect its rights.

3.      Using the packaging or decoration unique to well-known goods would be better to protect its right.

The cause of this lawsuit made by MOUTAI is trademark infringement, but Ronghe Wine Company actually did not use the words of the disputed trademark. In our opinion, it would be preferable for MOUTAI to protect its right through using the packaging or decoration unique to well-known goods as regulated in the Anti-unfair Competition Law.

Paragraph 2, Article 5 of the Anti-unfair Competition Law stipulates that, the act of using, without authorization, the names, packaging or decoration unique to well-known goods or the names, packaging or decoration similar to those of well-known goods so that their goods are confused with the well-known goods of others, causing buyers to mistake them for the well-known goods of others, is unfair means.

Therefore, if MOUTAI proves that Maotai is regarded as well-known goods and that Ronghe Wine Company used similar to or identical with that of Maotai so that their goods are confused with Maotai, MOUTAI may win this lawsuit.

 Lawyer Contacts

You Yunting：86-21-52134918  youyunting@debund.com/yytbest@gmail.com

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