Abstract
(By Albert Chen) Despite trademark is the important mark to indicate the origin of the product in its circulation, to decide whether the package of a noted product could constitute the special decoration, the trademark is not the absolute cause for the consideration. The reputation of the product shall be judged from the sales time, area, amount and object, and on the other hand, the fundamental condition for to decide the special decoration is whether it is distinctive.
Case Introduction
Guangzhou Xingqun (Pharmaceutical) Company (the “Company A”) and its affiliated companies have been producing the a herbal drink branded “群星(Qunxing)”. As to the packaging of the product, it is seen as in light yellow green, which comparatively dark on the top and bottom and yet light in the middle. On the top corner of the packaging, we could also see the leafs and trademarks decorated, for the trademark before 2003, it was “群星”, and after was “GPC”. Moreover, the image of the herbal made into the drink is painted on the bottom part of the drink.
In 2005, Company A found Guangdong Xinqun Beverage Company (the “Company B”) was selling same kind drink with similar packaging. For this reason, Company A filed the lawsuit in the court, accusing the unfair competition conducted by Company B for the infringement against the special decoration.
After the 1st and 2nd instance, Guangdong High People’s Court determined the unfair competition liability of the infringement against special decoration of the drink involved. Yet as dissatisfied with the decision, Company B appealed to the Supreme People’s Court of China (the “Supreme Court”) , as arguing that:
1. The noted product shall be indicated by its brand, and those products with no specific do not matter whether they are called the noted product or less noted product. For the beverage produced by Company A, it’s trademark of “Qunxing”is the one taken as the well known trademark not the trademark “GPC”as adopted when the dispute occurs.
2. The products involved in the case included herbal demanded in the process of manufacturing, and yet no one shall claim the exclusive right over their images, and for this reason, it could not be the special decoration. At the same time, as considering the design patent is for the protection term of 10 years, the design of the product packaging shall also be into the public domain as it has been used for more than 10 years.
3. The product of Company A is kind of pharmacy while the product of Company B is the drink, as they are sold in different ways, no confusion would be aroused among different consumers.
After the rehearing, the Supreme Court refused all claims of Company B and sustained the original decisions. For the appealing reasons, the Supreme Court interpreted that:
1. On the relation between trademark replacement and noted product determination
One product could be both differentiated through the trademark or the packaging of itself, which includes the name, out packaging and decoration of the product. All these method could help the public get to know the product. Basing on these, the trademark has no natural connection with the reputation of the product.
Considering the sales period, area, accepting party and amount involved in the sales, it has a high reputation, and naturally it shall be the noted product.
2. On the special decoration of the packaging by Company A and its protection term
Although the main packaging of the product includes the herbal demanded, and yet its choice and arrangement shows the originality. For this reason, Company A’s packaging is with distinctiveness.
As to the protection term of the decoration, there is no specific regulation in China’s legislature. Once there occurs the infringement, as the infringed product is the noted one, and it’s decoration is adequate to differentiate itself from the rest, and thus it shall be protected in law.
3. On the decision on the possible confusion
Despite Company A’s products are taken as the pharmacy, and that the product of Company B is the food, due to the product involved in the case is the one could either taken as the medicine of the food. To further take the overlap part of both companies’ product, it is highly possible to lead to the confusion among the recipient.
Lawyer Comment
The hearing court specifies the trademark is not the necessary condition in deciding the noted product, and at the same time it also specifies what plays the role in the special decoration determination. For these, the author concludes as the follows:
1. The reputation of the trademark is not the sole condition to decide the noted product
In the case, Company A has used two marks one after another, and that is the main part attacked by Company B. But the Supreme People’s Court defined that the trademark is not the fundamental element in considering the reputation of the product, and it shall be judged basing on the sales period, region, gains and recipients instead.
In the case, Company A has started the sales of the drink involved in the case from later 1980’s. And afterwards was awarded the noted product in Guangdong Province. But the aforesaid product title is evaluated independent and earlier to the granting of the well known trademark.
2. The special decoration shall be subject to the distinctiveness of the product packaging
In what condition could the packaging of noted product be taken as the special decoration, according to the understanding of the Supreme Court, it shall be with two standards in the judgment: 1) could it differentiate the product from the other; 2) the decoration has its own distinctiveness. To the understanding of the author, it has the progressive relation between the aforesaid standards. It is the first step to make your product be different from others as judging the decoration. But to achieve the step of “special”, it needs further the examination of its originality, which includes the choice and combination of lines or colors. In the case, we see the accused party defendant itself that the image of the herbal painted on the packaging of the product out packaging is the picture of the normal planting, but the court denied that its combination and coloring demands the originality, which could be the feature of specialty and differentiate from the common product’s packaging.
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