With the advent of social media and live tweeting, news travels fast – any average Joe can turn into a celebrity overnight and news on people in the limelight, from superstars to politicians, receives our instant attention. Trade mark trolls in China are watching too. More often than not, opportunistic trade mark applications have already been filed before this kind of fame can be capitalised on in China. This phenomenon is not new and examples of such ubiquitous practice were discussed in our article: It's all in the name: protect your own, published in the 2014 edition of this guide. Since then there have been developments in a number of key cases and a trend has emerged in how some of these difficult name disputes are resolved.
The legal arsenal
Name squatting is a big business in China and trade mark prospectors are becoming more sophisticated by the day. However, only a limited patchwork of law is available to combat name squatting. The basic legal principle for protecting the names of individuals, including those of celebrities, is found in the General Principles of the Civil Law: "citizens shall enjoy the right to use their personal names and … interference with, or usurpation and false representation of, personal names shall be prohibited". The Anti-Unfair Competition Law that prohibits the unauthorised use of another's name that causes confusion can also be used to stop the unlicensed exploitation of celebrities' names in China.
Most enforcement actions against name squatting, however, are based on the Trade Mark Law. Article 32 of the Trade Mark Law, last revised on May 1 2014, provides that "an application for a trade mark registration should not infringe the prior rights of others nor can an application preemptively register the trade mark of another which had already been in use and attained a certain degree of influence". The prior rights referred to in this provision include the rights of individuals to their legal names, pen names and nicknames.
At first glance, Article 32 of the Trade Mark Law provides a clear legal ground for protecting a celebrity's name as a prior right in China; however, in practice the situation is far from straightforward. Foreign celebrities seeking to claim prior rights in their names face various challenges:
- Chinese versions of a name – Trade mark authorities and the courts in China are often reluctant to recognise the Chinese versions of a foreign celebrity's name because such a name can often be translated into Chinese in many different ways, by transliteration or otherwise. Being able to prove that there is an exclusive association between a pair of English and Chinese names is almost impossible in many cases.
- Partial names – If the moniker of foreign celebrity is a commonly used first name or surname (for example, "Clinton" as illustrated in the Bill Clinton case below), the foreign celebrity will have a hard time meeting the very high evidentiary thresholds required to prove that the partial name is a reference to him or her.
- Name of a deceased celebrity – When such a name is pirated, the heir of the foreign celebrity, next of kin or a third party that has been authorised to use and exploit his or her name commercially will not be able to rely on Article 32 as it only protects the name rights of a living person.
An alternative remedy
Clearly, Article 32 of the revised Trade Mark Law has its limitations when it comes to protecting the name rights of foreign celebrities. The ingenuity of Chinese jurists, however, has come to the rescue. Chinese trade mark authorities and judicial bodies have been making creative use of a catch-all provision in the Trade Mark Law to recognise and extend protection to foreign celebrities' name rights in China. Article 10(1)(8) of the Trade Mark Law provides that a trade mark should not be detrimental to social morals or customs, or have another unhealthy social influence. Its legislative history indicates that name squatting is not among the evils that this provision is intended to cure. Nonetheless, it has been applied with increasing frequency by Chinese trade mark authorities and courts to address trade mark squatting of foreign celebrities in China, as illustrated by the following cases.
Clinton is a common English name made famous by Bill Clinton, the former US President. A Chinese individual Liu applied to register Clinton in Chinese characters as a trade mark for condoms, among other goods. The application was rejected by the Chinese Trade Mark Office on the basis that it would likely have an unhealthy social effect and should not be allowed to register as a trade mark because Bill Clinton is a former US President, a famous politician and a well-known public figure. Liu sought a review of the rejection and appealed his case to the Beijing Intermediate People's Court arguing that: Clinton is a commonly used name in English and is not exclusively linked to the former US president; trade marks involving the names of former US presidents or the head of a state in other countries have been allowed to register – for example, Lincoln in Chinese characters for cars and Churchill in Chinese characters on cigarettes; neither Bill Clinton nor any other person named Clinton had objected to the application; and over 500 million condoms branded with the mark have been sold over four years without causing any unhealthy social influence. The court was not persuaded by Liu's arguments and upheld the findings of the lower tribunals that registration for Clinton in Chinese characters on goods like condoms would cause unhealthy social influence and should not be allowed.
Bruce Lee is a name that requires no introduction in China or elsewhere. Zhang, a Chinese individual unrelated to the renowned Chinese-American martial artist and actor, applied to register Bruce Lee in Chinese characters as a trade mark for cars and small vehicles. The unfavourable initial opposition filed by Bruce Lee's daughter was overturned upon review and that decision was affirmed in subsequent court appeals. Zhang fought the case all the way to the Beijing High People's Court. In the final judgment, the court noted that Bruce Lee was an iconic Kung Fu master and enjoyed a high degree of reputation and fame. The mark in question was identical to the Chinese name of Bruce Lee and goods bearing it would probably mislead the public into believing that they had been produced with the authorisation of Bruce Lee's family. The court found that allowing that mark to register would have a negative effect upon public interest and public order – another way of saying that there would be an unhealthy social influence.
Andy Lau is a famous actor and singer from Hong Kong who enjoys a very high reputation in China. His Chinese name is pronounced Liu Dehua in Mandarin. Liu Dehua, however, is a fairly common man's name in China. As such, it has been difficult for Andy Lau to assert rights to his name because many others also have legitimate rights to use the same name.
"Clearly, Article 32 of the revised Trade Mark Law has its limitations when it comes to protecting the name rights of foreign celebrities"
A trade mark registration for Liu Dehua on cosmetic products was granted to an individual named Liu Dehua and it was later assigned to Jin Bai Li, a health food company from Guangzhou in 2010. Andy Lau began a proceeding to cancel the registration on the grounds that the mark infringed his prior name rights and the registration of the mark would probably cause an unhealthy social influence to society.
In mid-2011, his claim for protection based on a prior name right was rejected because the Trade Mark Review and Adjudication Board found that both Liu Dehua and Andy Lau had legitimate rights to use the same name. However, the tribunal found for Andy Lau on the ground of unhealthy social influence by noting that Andy Lau's name was widely recognised by the Chinese public, and, as celebrity endorsement was a common way to promote cosmetic products, the likelihood of confusion would be high if the mark in question were allowed to be used on such goods. This finding of potential unhealthy social influence was upheld on appeal by the Beijing Intermediate People's Court in 2012 and Jin Bai Li's trade mark registration for Liu Dehua was cancelled.
A trade mark registration for Michael Jackson on clothing, footwear, headwear, neckties and gloves was granted in China in 2013. It was later assigned to Feng Shang, a Chinese fashion company. "Beat it" would probably be the response of the King of Pop if he had been alive to know about that trade mark filing. It was no surprise when the trustee of Michael Jackson's estate brought an invalidation proceeding against that registration in 2014. However, the Trade Mark Review and Adjudication Board rejected their case. The Board held that the protection of prior name rights under Article 32 of the revised Trade Mark Law could not be applied to the name of a deceased person and a registration for the mark Michael Jackson would not cause any negative or adverse effect to the public and society. On appeal, the Beijing Intellectual Property Court allowed the case in part and decided in favour of the trustee by resorting to the unhealthy social influence ground in Article 10(1)(8). Feng Shang is reported to have appealed this November 2015 decision of the IP Court to the Beijing High People's Court.
In contrast, another Michael from the US, who had done very well on the basketball courts, did not fare at all well in Chinese courts. A series of high-profile and protracted trade mark disputes between Michael Jordan and Qiaodan Sports came to an end in 2015 with the NBA Hall of Famer crying foul. The Chinese sportswear and footwear manufacturer started using Qiaodan (a transliteration for Jordan in Mandarin Chinese) on shoes and jerseys and has secured trade mark registrations for the mark on a wide variety of goods since the millennium.
In 2012, Michael Jordan began proceedings to cancel over 70 trade mark registrations of Qiaodan Sports. In May 2015, the Beijing High People's Court allowed 32 of those registrations to stand and held that Jordan had failed to make a case under either Article 32 or Article 10(1)(8) of the Trade Mark Law. Specifically, his claim for protection based on prior name rights failed because there was insufficient evidence to establish an exclusive link between the Qiaodan mark and Michael Jordan, and Jordan is an ordinary name used by Americans. Moreover, his attempt to invoke the unhealthy social influence provision was effectively time-barred in that the court found that there was undue delay on the part of the basketball MVP in taking action. When the proceedings began in 2012, Qiaodan Sports had already developed a sizable business under the Qiaodan brand after over 10 years of actual use and most of its marks had been registered for more than five years. In fact, the Qiaodan mark had been recognised repeatedly as a well-known mark in China before 2012.
The unfavourable decision of the Beijing High People's Court is unlikely to be the final duel between the parties. Michael Jordan can still seek leave of the Supreme People's Court to have these trade mark cases retried by the highest court in China. Jordan's spokesperson has already indicated his intention to do so. In any event, new battlefronts have already been opened – many new trade mark applications of Qiaodan Sports are being opposed and the retired sportsman will be kept busy playing in the Chinese courts for at least a few more years.
An unpredictable situation
Chinese trade mark authorities and the judiciary have been protecting the name rights of Chinese and foreign celebrities by applying the unhealthy social influence provision in the Trade Mark Law. Its open-ended nature has allowed jurists to dispense Chinese style rogue justice with reference to equitable considerations or other factors as they see fit. But it also means that when and how this fashionable remedy may be applied is unpredictable. This less than desirable situation will remain until the Supreme People's Court or the Chinese legislature decides to give us some guidance.
|Cedric Lam leads the IP team in Dorsey’s offices in Greater China and coheads the firm’s operations in Hong Kong. He has more than 20 years’ experience in advising on IP transactions and litigation as well as implementing IP protection strategies. Cedric is also experienced in anti-counterfeiting and other IP enforcement matters. He has been peer-rated repeatedly as a leading franchise lawyer and is ranked in the IAM Patent 1000.|
|Lilian Shi is a senior IP associate in the Hong Kong Office of Dorsey & Whitney. She qualified as a lawyer in China and was later admitted as a solicitor in New Zealand and Hong Kong. Lilian is experienced in handling a wide variety of IP issues in Greater China, including patent, trade mark and copyright matters, both contentious and non-contentious. She is also experienced in managing IP portfolios for multinational clients.|
|Ivy Tsui is an IP associate in the Hong Kong office of Dorsey & Whitney. She qualified as a lawyer in Ontario, Canada, and is a registered foreign lawyer in Hong Kong. Ivy advises on all aspects of IP, including patent protection and enforcement strategies, licensing and franchising agreements, brand protection and trade mark prosecution, domain name disputes, copyright piracy, anti-counterfeiting, and other IP litigation matters.|
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