Chinese newspapers report that Hangzhou Wahaha Foods, a joint venture created by Danone and China’s Wahaha Group, claims that the China Trade Mark Office (CTMO) did not follow the correct administrative procedures when it rejected an application to have the Wahaha trade marks transferred to the joint venture companies.
The Beijing No 1 Intermediate People’s Court accepted the case on August 31, sources say.
Danone and CTMO both declined to confirm the reports.
The question of whether the Wahaha trade marks were transferred to the joint venture is a key part of the dispute between Danone and Chinese drinks maker Wahaha.
The two companies set up five joint venture companies in 1996 to sell a range of drinks including bottled water and fruit juices. Danone took a 51% stake in the operations and says all Wahaha trade marks should have been transferred to the joint venture companies.
In June this year Danone sued Wahaha in a Los Angeles court claiming that Wahaha was selling products that competed with those made by the joint venture and was using the Wahaha brand illegally.
In response, Zong Qinghou, chairman of Wahaha, resigned from the joint venture. He also claimed that the relevant trade marks were still owned by Wahaha on the grounds that CTMO had never approved the transfer of the trade marks to the joint venture.
China’s Trade Mark Law says a trade mark assignment has to be recognized by CTMO to be valid.
A Danone spokesperson has previously told MIP Week that "a transfer of trade mark agreement" was signed by Wahaha Group and the joint venture in 1996 and that in 1999 both parties signed "the licence agreement of trade mark" which specified that the joint venture had exclusive right to the trade mark "until the transfer process is completed".
Hangzhou Wahaha Foods is now reported to be arguing that CTMO rejected the transfer but did not give a written explanation for its decision, as it was supposed to do.
In addition to the court case in Los Angeles, the dispute is being arbitrated in Stockholm and Hangzhou.
The news focus in the July/August edition of MIP took an in-depth look at the Danone –Wahaha dispute and considered ways that IP owners can protect their rights in joint ventures in China.
