Practice Trends
This case was selected by Beijing High Court among the Ten Most Significant Cases of the Beijing High Court and the Ten Most Notable Cases Pertaining to Judicial Protection for Trademark Prosecution in 2024. It serves as a notable illustration of the thorough investigation of fraudulent evidence in cases of non-use cancellation of trademarks registered over three-years.
When the court employs the investigation order mechanism to acquire original evidence from the relevant parties and uncovers that the registrant of the disputed trademark has submitted false evidence, it becomes essential for the additional evidence provided by the applicant to be subjected to rigorous examination. This case underscores the judiciary's dedication to diligently verifying the legitimacy of trademark usage, thereby promoting the transparency and integrity within the legal proceedings.
Case Summary
The trademark "FUSTE" (No. 15052973) was registered by Jiangxi Hui Digital Energy Technology Co., Ltd. (hereinafter referred to as "Hui") on July 31, 2014, for use in Class 9, which encompasses products such as "electric switches, inverters (electricity), sensors," among others.
Yan subsequently initiated a non-use cancellation of the trademark for a period of three consecutive years. The China National Intellectual Property Administration (CNIPA) concluded that the trademark should be retained for the following goods: "electric switch; control board (electrical); inverter (electrical); sensor; regulated power supply," while revoking its registration for other items. Dissatisfied with this ruling, Yan proceeded to file for a review of the revocation.
CNIPA reaffirmed its decision, citing evidence that demonstrated the trademark had been actively utilized in commercial activities pertaining to "inverter" products during the specified timeframe of August 31, 2018, to August 30, 2021. Despite this ruling, Yan remained dissatisfied and opted to initiate legal proceedings.
During the court proceedings, an Investigation Order was issued at the request of Yan, resulting in the retrieval of the original contract from Fuzhou Light Import and Export Co., Ltd. This company had entered into a Purchase and Sales Contract with the trademark licensee on February 10, 2021. The investigation revealed that the contested trademark was not included in the "article number" of the contract, and inconsistencies were identified between the contract amount and the documentation submitted by Hui during the trademark review.
Upon evaluating the evidence, the court raised concerns regarding the authenticity of Hui's submissions. It determined that the invoices presented by Hui, which were purportedly linked to the Purchase and Sales Contract, did not constitute valid use of the disputed trademark. Additionally, none of the supplementary evidence provided by Hui demonstrated the use of the trademark.
As a result, the court concluded that Hui had failed to establish legitimate, legal, and effective use of the disputed trademark during the specified timeframe, leading to the decision to revoke the trademark. This ruling overturned the prior decision made by CNIPA, which subsequently issued a new ruling. Yan opted not to appeal this decision.
Judicial Viewpoints
The court has concluded that the substantive issues pertaining to this case are to be governed by the 2013 Trademark Law, while procedural matters will be regulated by the 2019 Trademark Law. In accordance with Paragraph 2 of Article 49 of the 2013 Trademark Law, if a registered trademark has not been utilized for a continuous period of three years without valid justification, any individual or entity is entitled to petition the Trademark Office for its cancellation. The term "use" in this context is defined as the genuine, public, legal, and effective commercial application of the trademark.
In this specific case, the court reviewed a Purchase and Sale Contract dated February 10, 2021, between Fuzhou Light Industry Import and Export Co., Ltd. and a third party. Notably, the contract did not include the Disputed Trademark in the "Item Number," and the financial details presented differed from those in the version of the contract submitted by the third party during the administrative phase, which did reference the Disputed Trademark.
The court undertook a comprehensive examination of the evidence provided by the third party. The invoices related to the aforementioned Purchase and Sale Contract were not considered sufficient evidence of the use of the Disputed Trademark. Additionally, none of the supplementary evidence submitted by the third party demonstrated the use of the Disputed Trademark or substantiated its legitimate application during the contested period. As a result, the court determined that the evidence presented by the third party did not establish that there had been genuine, lawful, and effective use of the disputed trademark, leading to a revision of the defendant's judgment.
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