What is Article 15 of China Trademark Law About?
The intent of Article 15, Paragraph 2 of the Trademark Law is to prevent individuals who are aware of another's trademark, due to their specific relationship, from infringing upon that trademark.
This aims to foster a marketplace characterized by honesty and fair competition. An unregistered trademark protected under this provision can only be enforced against certain related parties. Consequently, there should not be a higher standard for "prior use" as outlined in Paragraph 2 of Article 15. As long as the trademark serves to identify the source of goods and its usage extends within the territory of China, and the trademark applicant is aware that others with whom they have a specific relationship have already utilized the trademark, it should be considered to fulfill the criteria for prior use.
SPARTECH Case Overview
About Rudong Company and Nantong Ruisheng Company
The disputed trademark "SPARTECH" (No. 26413210),was filed for registration by Rudong Company on September 14, 2017, and approved for registration on November 21, 2018. The disputed trademark covered goods in Class 28 including boxing gloves; elbow pads (sporting goods); knee pads (sporting goods).
On October 20, 2020, the disputed trademark was officially transferred to Nantong Ruisheng Sports and Leisure Goods.
On April 24, 2020, Spida Company filed a request with CNIPA to invalidate the disputed trademark. Subsequently, on December 18, 2020, CNIPA issued the unfavorable ruling, stating that the evidence provided by Spida Company was insufficient to demonstrate any contractual or business relationship with Nantong Ruisheng Company, nor did it establish that Nantong Ruisheng Company was aware of Spida Company's "SPARBAR" trademark. As a result, the registration of the disputed trademark was upheld, as it did not meet the criteria outlined in paragraph 2 of Article 15 of the Trademark Law of the People's Republic of China, as amended in 2013.
Evidence showing Nantong Ruisheng's awareness of SPARBAR trademark
Spida Company was dissatisfied with CNIPA ruling and appealed it with the Beijing Intellectual Property Court. During the trademark invalidation procedure, Spida Company presented several key pieces of evidence to CNIPA, including: 1. Litigation trademark files; 2. The passport of Jess Gill, the founder of Spida; 3. The British trademark registration certificate, transfer certificate, and translation for the "SPARBAR" trademark; 4. Images and video screenshots of "SPARBAR" products; 5. A letter of proof along with its translation; 6. HSBC Bank payment records and their translation; 7. Sales orders and their translations; 8. The publication text and translation of the PCT patent application.
During the initial trial litigation phase, Spida Company presented additional two notary documents which included the following details:
The corporate email address for Nantong Ruisheng Company ends with "@ruilin.com."
There was an email correspondence between Jazz Gill, Spida's legal representative, and Mr. Tao. In an email dated June 5, 2017, Mr. Tao requested Jazz to review an attached image, stating, "Please check the attached picture. We are printing a PVC box for confirmation. The target diameter is 4CM. Is that acceptable?" The attached image featured the "SPARBAR" design. In a subsequent email on August 1, 2017, Mr. Tao confirmed with Jay that Spida had the rights to use the "SPARBAR" trademark, asking, "So we can sell products featuring the 'SPARBAR' trademark, correct?" Furthermore, in an email dated August 2, 2017, he noted, "To sell our products online, we will need a registration certificate for the 'SPARBAR' brand." Nantong Ruishang acknowledged Mr. Tao as a salesperson and indicated that while they had consulted with Spida, a formal business relationship had not yet been established.
Additionally, an email from Jaswinder Gill to Mr. Tao on May 25, 2017, included the following message: "Official SPARBAR - Boxing, MMA, Fitness, and Combat Sports Equipment Official SPARBAR Store - offers the best boxing and MMA fitness equipment."
Spida's trademark "SPARBAR" was officially registered in the United Kingdom on October 31, 2012, under Class 28, which covers "Fitness and sports equipment" among other goods.
In December 2015, several users on Sina Weibo shared a microblog from "@mmanews-jianke," which stated: "Many friends have inquired about where to purchase this product, known as #SPARBAR#, which can be translated as #actual target#. It is a British product, and it is unclear whether it is available in China. However, the official website lists the home version at £166 and the professional version at £349.99." The post included an image of the SPARBAR boxing equipment.
Beijing IP Court Ruling
In relation to the registration of the contested trademark and its adherence to paragraph 2 of Article 15 of the Trademark Law, the Beijing Intellectual Property Court found that Nantong Ruisheng Company, which has an indirect business connection with Spida Company, intentionally applied for a trademark that is similar to the "SPARBAR" trademark owned by Spida Company, for the same or similar goods. This action was deemed a violation of the provisions set forth in the second paragraph of Article 15 of the Trademark Law, leading the court to determine that the disputed trademark should not be granted registration. If there are any ambiguities in the facts or misinterpretations of the law, the ruling should be overturned. As a result, the court annulled the previous decision and directed the State Intellectual Property Office to issue a new ruling.
Dissatisfied with this outcome, Nantong Ruisheng Company appealed to the Beijing Higher People's Court, arguing that the disputed trademark did not infringe upon the second paragraph of Article 15 of the Trademark Law and requested the original judgment be overturned.
Beijing High Court Ruling
Beijing High Court found that prior to September 14, 2017, the date of the trademark application in question, numerous users on Sina Weibo had utilized the unregistered trademark "SPARBAR" for boxing gloves and other products, which contributed to identifying the source of these goods. The contested trademark, "SPARTECH," bears a resemblance to the "SPARBAR" logo used by Spida Company in terms of its letter formation and pronunciation, thus constituting a similar trademark for goods such as boxing gloves.
Evidence, including notarized certificates submitted by Spida Company, indicated that a commercial consultation occurred in June 2017 between a salesperson from Nantong Ruisheng Company and the legal representative of Spida Company, prior to the trademark application date. At that time, Nantong Ruisheng Company should have been aware of the unregistered "SPARBAR" trademark used by Spida Company. Despite this knowledge, Nantong Ruisheng Company proceeded to acquire the disputed trademark through assignment on October 20, 2020, which raises questions about their good faith in this matter.
To successfully prevent the illegal registration of someone else's trademarks, the initial ruling determined that the disputed trademark met the conditions outlined in the second paragraph of Article 15 of the Trademark Law, indicating no clear wrongdoing. Consequently, the appeal was rejected, and the original ruling was maintained.
Further Analysis of Article 15 of China Trademark Law
In the amendments to the Trademark Law made in 2013 and 2019, the provisions regarding trademark applications by agents, representatives, and certain related parties have remained unchanged.
The first paragraph indicates that if an agent or representative registers a trademark in their own name without the principal's or representative's permission, and the principal or representative objects, the registration will be denied, and its use will be prohibited.
The second paragraph clarifies that if a trademark application for the same or similar goods is identical or similar to an unregistered trademark that another person has previously used, and the applicant has a contract, business relationship, or other connection with that person while being aware of their trademark, the application will not be registered if the other person objects.