Article 6 of the Anti-Unfair Competition Law (hereinafter referred to as the Revised AUCL), revised in 2019, stipulates that "Business operators shall not engage in the following confusing acts that lead others to mistakenly believe that their commodities are those of others or that they have a specific connection with others: (1) Unauthorized use of signs that are identical with or similar to the commodity names, packaging, decoration and other elements of others that have a certain influence".
Prior to the revision of the AUCL, "well-known commodities" had long been a contentious legal issue among scholars, experts and in judicial trial practice. The core of the dispute was: What is the objective criterion for determining a "well-known commodity" in the phrase "packaging and decoration of well-known commodities"?
Some scholars argue that the "packaging and decoration" protected by the AUCL refers to those of commodities with a certain reputation, yet the criterion for judging such "reputation" differs from that for determining the reputation of well-known trademarks. First, the reputation of such commodities or services may be limited to a relatively small geographical area, and it is not required to reach a national reputation like well-known trademarks. If imitated by others, the packaging and decoration shall be protected by the AUCL as long as there is a possibility of confusion within that geographical area, and an actual result of confusion or misrecognition is not a prerequisite. Second, it is sufficient that the elements have acquired a certain distinctiveness through the plaintiff's use, and the relevant public can establish a corresponding connection between the commodity's name, packaging, decoration and the plaintiff.
Other scholars hold that an important purpose of the AUCL in prohibiting imitation acts is to prevent misleading consumers due to the confusion of commercial signs. The objects protected by the AUCL are different from artistic works under copyright law and design patents under patent law, focusing mainly on unregistered signs. What the AUCL protects is not well-known commodities, but the well-known signs of commodities. No matter how well-known a commodity is, it is distinguished in the market by its signs. Only when the signs that distinguish commodities are well-known and imitated by others will market confusion arise. The "well-known commodity" in the AUCL is not so much the fame of the commodity itself as the fame of its commercial signs such as packaging and decoration. Article 4 of the
The Revised AUCL sets "having a certain influence" as a common requirement for prohibiting the imitation of commercial signs, which is of positive and far-reaching significance. Then, how to determine the commodity names, packaging and decoration that "have a certain influence"?
The expression "having a certain influence" appears in several provisions of the Trademark Law: the "trademarks that have been used and have a certain influence" stipulated in Article 32 of the Trademark Law, and the "prior used trademarks that have a certain influence" which may continue to be used within the original scope of use as stipulated in Paragraph 3 of Article 59 of the Trademark Law. The provisions of Article 6 of the Anti-Unfair Competition Law are connected with the protection of trademarks with a certain influence under Article 32 and Paragraph 3 of Article 59 of the Trademark Law, and the criteria for their determination shall be unified.
Commercial signs identifying the source of commodities or services include trademarks, commodity names, packaging and decoration; those identifying business entities include enterprise names and personal names; and those identifying business activities include advertising slogans. The protection of commercial signs by the Anti-Unfair Competition Law does not depend on whether they are registered or recorded, but on whether they constitute commercial signs and whether they are likely to cause the relevant public to confuse or mistakenly believe that there is a specific connection. Whether it is unregistered trademarks, enterprise names, personal names or domain names, when used in relevant production and business activities, they must first be easy to identify by the relevant public to play the role of identifying commercial sources, and only when they play this role may they cause the relevant public to confuse or mistakenly believe that there is a specific connection.
In judicial practice,
the general judicial thinking of judges in trying such cases is as follows:
First, examine whether the packaging and decoration of the allegedly infringing commodities or services are the objects protected by the Anti-Unfair Competition Law, i.e., whether they are the packaging and decoration of commodities with a certain influence;
Second, examine whether the name, packaging and decoration of the allegedly infringing commodities or services are identical with or similar to those of the right holder's commodities or services, and whether consumers may confuse or misrecognize the two when observing them in isolation and with ordinary attention;
Finally, determine that the infringer shall bear the corresponding legal liabilities.
In terms of the subjective intent of infringement, judges mainly determine whether the parties have violated the principle of good faith and the generally recognized business ethics.
Lawyers shall pay attention to the following in undertaking such cases in practice:
First, clarify the litigation claims and make an accurate judgment and grasp of the case.
Accurately predict which elements in the packaging and decoration of the client's commodities or services can constitute the packaging and decoration of commodities with a certain influence. It is necessary to confirm whether to protect the overall style and appearance formed by the combination of graphics, text, colors, container shapes, or to specifically fix on the text content among them.
In the dispute over the red can packaging between Wong Lo Kat and Jiaduobao, the original litigation claim of the plaintiff's lawyer in the first instance was: "The imitation of the unique packaging and decoration of Jiaduobao Company's well-known commodity - red can Wong Lo Kat herbal tea infringes on Jiaduobao Company's right to the unique packaging and decoration of well-known commodities and the right to the unique names of well-known commodities such as 'red can', 'red can herbal tea' and 'red can Wong Lo Kat', and is sufficient to cause purchasers to confuse the quality and source of the red can Wong Lo Kat products produced by Great Health Company, constituting an unfair competition act". Later, the claim was changed to "cease to use the packaging and decoration identical with or similar to the unique packaging and decoration of Jiaduobao Company's well-known herbal tea commodities". The original right basis of the plaintiff's litigation claim was the "unique packaging and decoration of red can Wong Lo Kat herbal tea", while the right basis after the change was the "unique packaging and decoration of Jiaduobao Company's well-known herbal tea commodities". The trademark "Wong Lo Kat" is owned by Guangzhou Pharmaceutical Holdings, Ltd.. Although the courts of first and second instance did not examine the plaintiff's amended litigation claim and found that the packaging and decoration containing the text "Wong Lo Kat" was the object protected by the Anti-Unfair Competition Law, the author boldly speculates that if the attorney could have accurately judged the elements of the protected object in the plaintiff's claim and excluded the trademark text "Wong Lo Kat" owned by Guangzhou Pharmaceutical Holdings, Ltd. at the beginning, would there have been a better outcome?
In the retrial case between Jiangsu Southern Orchard Biotechnology Co., Ltd. (hereinafter referred to as Southern Orchard Company) and Jiangsu Susha Food Co., Ltd. (hereinafter referred to as Susha Company), the effective prior judgment held that the registration of the text "Special Forces" and the shield graphic as a trademark would have an adverse effect. The allegedly infringing packaging and decoration took the identical text and graphic parts as the prominent identifying parts, and other constituent elements of the packaging and decoration were highly associated with the above text and graphic, which was likely to cause consumers to associate the overall packaging and decoration with "Special Forces". Therefore, the allegedly infringing packaging and decoration should also not be protected as the packaging and decoration "having a certain influence" under the Anti-Unfair Competition Law. In accordance with Article 5 of the Judicial Interpretation of the former Anti-Unfair Competition Law (Article 7 of the Judicial Interpretation of the Revised Anti-Unfair Competition Law), where the name, packaging or decoration of a commodity falls under the signs that shall not be used as trademarks as stipulated in Paragraph 1 of Article 10 of the Trademark Law, the party's claim for protection in accordance with Item 2 of Article 5 of the Anti-Unfair Competition Law implemented in 1993 was not supported by the court in the end. Should the attorney also have predicted that the use of "Special Forces" as a trademark might affect the right to packaging and decoration due to a violation of Item 8 of Paragraph 1 of Article 10 of the Trademark Law?
Second, sufficient evidence shall be prepared to prove that the signs "have a certain influence".
Article 12 of the Judicial Interpretation of the Supreme People's Court on the Application of the Anti-Unfair Competition Law of the People's Republic of China stipulates that when a people's court determines whether a sign identical with or similar to the sign "having a certain influence" as stipulated in Article 6 of the Anti-Unfair Competition Law, it may refer to the principles and methods for determining identical or similar trademarks. Article 4 stipulates that a sign with a certain market reputation and distinctiveness to distinguish the source of commodities may be determined by a people's court as a sign "having a certain influence" as stipulated in Article 6 of the Anti-Unfair Competition Law. When determining whether a sign stipulated in Article 6 of the Anti-Unfair Competition Law has a certain market reputation, a people's court shall comprehensively consider the degree of awareness of the relevant public in China, the time, region, volume and target of commodity sales, the duration, intensity and geographical scope of publicity, the status of protection of the sign and other factors. It can be seen from the judicial interpretation that distinctiveness and reputation are important criteria for judging whether a sign "has a certain influence".
When submitting evidence of "having a certain influence" to the court, lawyers may specifically provide the following evidentiary materials:
(1) Relevant materials such as the earliest use time and continuous use of the commodity or service;
(2) Contracts, invoices, delivery orders, bank deposit slips, import and export documents of the commodity or service;
(3) Relevant materials such as the sales area, sales volume, sales channels and methods, and market share of the commodity or service;
(4) Commercial advertisements and publicity materials released by the right holder of the commodity or service on radio, television, newspapers, periodicals, the internet, outdoor media and other media, as well as all comments, reports and publicity materials related to the commodity or service in the above media;
(5) Relevant materials of the commodity or service participating in trade fairs, expositions, auctions and other commercial activities;
(6) Goodwill materials such as awards won by the commodity or service;
(7) Other materials that can prove the commodity or service has a certain influence, such as evidence of protection records and actual results of confusion or misrecognition caused.
The evidence to prove that a commodity's name, packaging and decoration "have a certain influence" may vary in different cases. However, if a self-developed and produced product has a certain reputation and market share, the right holder shall timely and actively claim its rights when encountering infringement and counterfeiting acts. On the one hand, it is the full protection of one's own intellectual property rights, and on the other hand, it is responsible for the majority of consumers.
