The protection of the Well-known trademark [1]

This article includes three parts, the first is about the general information about the protection of the well-known trademark; the second is about the relationship between the well-known trademark and the domain name, the third is a brief introduction to the protection of well –known trademark in China. 

Part 1 - Introduction the protection of the well known trademark

 1.Globle village, the reputation of the trademark not limited to its territoriality

Since now we are in a globe trade stage, people always travel around. With the technology’s development in the field of communications, the Internet, the satellite television, international travel and the spillover advertisement, some trademarks which were known in a given geographical area are known almost throughout the world.

       2. Trademarks are valuable asset

Trademarks are often the most valuable assets of an enterprise, such as the brands COCA-COLA, MARLBORO, and IBM have been estimated to be worth close to $100 billion as intellectual property assets.[3]So the appropriate protection of well-known trademarks and the other intangible property has become a significant factor in the trade relations between nations. In the long run, international strengthening of the protection of the well-known marks contributed not only to the benefit of the trademark owner, but was also very important in ensuring the stable and fair development of international trade.

3. Special Characters of the well known trademark

a. Exception to territoriality

The principle of territoriality means that the protection of a trademark in a certain country depends exclusively on the law of that country, and that the effects of a trademark ownership by use or by registration in a country do not reach beyond the borders of that country, it also means that only facts occurring in a certain country may affect the trademark right in that country. But there are exception to this principle, that is the world wide reputation of a mark as a basis of extended protection.[4]

b. Exception to specialty

The principle of specialty stipulates that trademarks can only be protected in relation to the same or similar goods or services covered by their registration or use. But according to Section 16(3) of the TRIPS Agreement, in certain circumstances, a trademark can be granted extended protection to non-competing goods or services.

Section 16(3) of the TRIPS Agreement makes a legal basis available for the protection of well-known marks on non-competing goods or services on the condition that the mark has been registered. Protection is afforded in relation to goods or services which are not similar provided that the use of the mark on such dissimilar goods or services would indicate a connection with the owner of registered trademark, and the interests of the registered trademark owner are likely to be damaged by such use.[5]Thus, the extended protection of the well-known trademarks to non-competing goods or services constitutes an exception to the principle of specialty.

    c. Exception to registration

    a) Different view of acquisition of ownership

In United States, the right in a trademark arises out of appropriation and use; In British law countries, a person may apply for registration of a trademark, when claiming that he is entitled to be registered as the proprietor, as to the Unregistered marks, they are protected only under the passing off action; In civil law countries, where use or bona fide intent to use the mark at the time of the filing of the application is not required, registration is controlling as to proprietorship, except that the existence of good faith or absence of fraud is a condition precedent to registration.[6]

b) Both the Paris Convention and the TRIPS Agreement establish protection for well –known marks whether or not they are registered in the country in which the protection is sought.

Thus in the country where the prerequisite for protection is registration, the protection of the well –known trademark constitutes an exception to the principle of registration.

    4.In order to protect the well-known mark, protect scope and the criteria must be clearly prescribed.

    A. The definition of the well-known mark

     The international protection of famous and well-known marks is recognized in two multilateral treaties: the Paris Convention for the Protection of Industrial Property (the Paris Convention), to which 154 States are party, and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), by which 134 States are bound.[7]

The concept of a well known mark was developed in the context of Article 6 bis of the Paris Convention to provide owners of marks, which were widely known in the marketplace but not registered, with a measure of protection against later registrations of the same mark by others.[8] There is no clear and uniform definition about the well-known trademark, generally, there are several terms used to describe the well-known marks. They are “well-known marks”, “famous marks”, “notorious trademarks” and “the trademark with reputation”.

Well-known marks: According to the AIPPI Report on Well-Known marks: A well known trademark can be circumscribed as a mark which is known to a substantial segment of the relevant public in the sense of being associated with the particular goods or services.

Famous trademark: it is a term used by the United States and other countries. Generally speaking, famous trademarks are traditionally considered to have a higher degree of reputation than well-known marks and therefore deserve a broader scope of protection against unauthorized use on non-competing goods or service.

The trademark with reputation: this term is used by the European Trademark Harmonization Directive and the European Trademark Harmonization. According to the regulation, article 9, a community trademark shall confer on the proprietor exclusive right therein, the proprietor shall be entitled to prevent all third parties not having his consent from using in the course of trade: any sign which is identical with or similar to the Community trademark in relation to goods or services which are not similar to those for which the Community trademark is registered, where the latter has a reputation in the Community and where use of that sign without due cause takes unfair advantage or is detrimental to, the distinctive character or the repute of the Community trademark.[9]

Besides the Paris convention, the second international convention dealing with the well-known trademark is the Agreement on Trade-Related Aspect of Intellectual Property Rights. In Article 16 (2), (3) the TRIPS Agreement has some specific regulations about the well-known trademark. Article 16 (2) makes the Article 6 bis of the Paris Convention applicable to the service trademark, also it defines some relevant factors to be considered when deciding whether a mark is well known or not; Article 16 (3) extends the Article 6 bis of the Paris Convention to dissimilar goods and services, provided that the use of the mark in relation to dissimilar goods and services would imply a connection or association with the owner of the registered trademark and the interest of the trademark owner must be likely to be damaged by such use. It should be point out only when the trademark are registered in the relevant country can the protection be extended to the noncompetitive goods and services.

But there are a lot of debates about the conditions for a mark to be protected in a proposed country. Such as some Jurists and scholars said that, under the Paris Convention, a mark must be well known in the country in which protection is sought in order for it to enjoy the benefit of Article 6bis of the Paris Convention.[10]  But others say that it is sufficient that the mark is well known only in the country of origin or elsewhere; it must not in fact also be well known in the country where protection is sought.[11]

In order to solve all this controversies, a number of countries have approached the WIPO to seek clarification on their obligations under the Paris Convention and the TRIPS. In order to clarify the above issues, WIPO began to research this issue after the conclusion of the TRIPS Agreement. A special program was set up to study and determine the criteria for the definition of well-known trademarks under Article 6 bis of the Paris Convention and Article 16 of the TRIPS Agreement. [12] The draft Provision on the Protection of Well-Known Marks have been considered by the WIPO Committee of Experts on Well-Known Marks on its first session (November 13 to 16, 1995), second session (October 28-31, 1996), and third session (October 20-23,1997). The Standing Committee on the Law of Trademarks, Industrial Designs and Geographical Indications (SCT) continued the work at its first session(July 13-17, 1998), second session, first part (Match 15-17, 1999), and its second session , second part (June 7-11, 1999). [13] Then the Joint Recommendation Concerning Provisions on the Protection of Well – Known Marks was adopted at a joint session of the Assembly of the Paris Union for the Protection of Industrial Property and the General Assembly of the WIPO at the34th Series of Meetings of the Assemblies of the Member States of WIPO (September 20-29,1999). It recommends the Member State of the Paris Union or of WIPO to pay attention to protect the well –known marks in accordance, mutatis mutandis with the joint recommendation.

B The criteria to be a well-known mark under the Joint Recommendation Concerning Provisions on the Protection of Well –Known Marks.

According to the Joint Recommendation Concerning Provisions on the Protection of Well –Known Marks, Determination whether a mark is well known in member state, the competent authority shall take into account any circumstances from which it may be inferred that the mark is well known. In particular, should consider information including, but not limited to the following factors:

   1.the degree of knowledge or recognition of the mark in the relevant sector of the public;

   2.the duration, extent and geographical area of any use of the mark;

   3.the duration, extent and geographical area of any promotion of the mark, including advertising or publicity and the presentation, at fairs or exhibitions, of the goods and services to which the mark applies;

   4.the duration and geographical area of any registration, and /or any applications for registration, of the mark, to the extent that they reflect use or recognition of the mark;

   5.the record of successful enforcement of rights in the mark, in particular, the extent to which the mark was recognized as well-known by competent authorities;

   6.the value associated with the mark

C.        The scope of protected

   According to Article 3 of the WIPO joint recommendation, it is clear that Member States are obliged to provide protection to well-known marks against conflicting designations at least with the effect from the time when the mark has become well known in the Member States in question.[14]  Generally, the well-known trademark is protected by refusal or invalidation or by prohibits use of conflicting marks.

   Under the Joint Recommendation, a mark will be deemed to be in conflict with a well known mark, where the mark, or an essential part thereof, constitutes a reproduction, an imitation, a translation, or a transliteration, liable to create confusion, of the well –known mark, if the mark, or an essential part thereof, is used, is the subject of an application for registration, or is registered, in the respect of goods and / or services which are identical or similar to the goods and / or services to which the well-known marks applies.

    Protection under the 6 bis of the Paris Convention:

    (1) The protection accorded to famous and well-known marks is a protection against the registration and use of a trademark that constitutes a reproduction, imitation or translation, liable to create confusion, of a well-known or famous mark or an essential part of such a mark.

    (2) The protection in Article 6bis extends only to trademarks, that is marks that are used in respect of goods, and does not extend to service marks which are used in respect of services.

    (3) The protection extends to registration or use in respect of identical or similar goods.

    (4) Article 6bis is silent on what constitutes a well-known mark. The appreciation of whether a mark is well known is left to the “competent authority” of the country where the illegitimate registration or use occurs.

    Protection under the Article 16 of the TRIPS Agreement

    (1) Article 16.2 extends the protection of Article 6bis of the Paris Convention to famous and well-known service marks.

    (2) Article 16.2 of the TRIPS Agreement provides a non-exhaustive guide to the competent authorities of countries in appreciating whether a mark is well known. In this respect it provides that, in “determining whether a trademark is well known, Members shall take account of the knowledge of the trademark in the relevant sector of the public, including knowledge in the Member concerned which has been obtained as a result of the promotion of the trademark.”

    (3) Article 16.3 of the TRIPS Agreement provides for protection that extends beyond the normal protection under the principle of specialty. It provides for the protection under Article 6bis of the Paris Convention to apply to goods and services which are not similar to those in respect of which a trademark is registered on two conditions: first, that the use of the allegedly infringing mark in relation to those other goods or services would indicate a connection between those other goods or services and the owner of the famous mark, and, secondly, that the interests of the owner of the famous mark are likely to be damaged by such use. This extended protection reflects a distinction that is made in many national laws between, on the one hand, famous marks, which represent that class of well-known marks that are so famous that they require protection against infringing use in respect of any goods or services, and, on the other hand, well-known marks, which require protection against infringing registration or use in respect of the same or similar goods or services for which the well-known mark is registered or used.

    D. Remedies.

Once a mark has been recognized by the competent authority as well-known, the owner of a well-known trademark is entitled to request that with respect to a mark which is liable to create confusion with the well –known trademark, an application be refused or a registration be cancelled or the use be prohibited. Also protection is granted against the reproduction or imitation of the well –known mark with respect to identical or similar goods or services.

1. Civil action

    The owner of the well-known trademark can file a civil action or against the infringer. In the civil action, the owner of the well-known trademark can ask for injunction and damages suffered. The injunctive relief is the most effective and most appropriate remedy.[15] When the court consider grant injunction or not, it usually apply the balance of convenience test.[16] When ask for damage, the court always require the plaintiff give the evidence of a likelihood of damage caused by the infringing use of the well-know trademark.

2. Administrative action and custom enforcement

   According to the Paris Convention and the TRIPS Agreement, a particular mark is well-known in the relevant country can be a ground for the Trademark Registration Office to refuse such application or be a ground to opposition or ask for cancellation by the interested party.

   The owner of the well-known trademark can record its trademark in the relevant custom, and ask for border enforcement. If he has reason to believe that importation of suspect goods may take place, he can file an application with the Custom for seizure and suspension of suspect good. In most jurisdictions, the owner need supply bond or other guarantee for seizure or suspension.

3.Criminal action

In some jurisdiction, infringing a registered trademark can be an criminal offence, such as in Japan[17], Vietnam[18], and China[19].

 

Part 2. The nexus between the well known trademark and the domain name

 

The Internet is a global communications network made up of millions of interconnected computers. Today, Internet is everywhere; one hundred and forty million people now have connections to the Internet, with more than thirty thousand additional people gaining access to the Internet everyday.[20]The Internet gives individuals and the business entities the ability to advertise and reach an audience of millions with a minimal cost, either by sending bulk-email or by establishing a web site. So the Internet offers unlimited business opportunity, the interested people are eager to establish their web site on the Internet. Domain name is such an address used to identify a particular location on the Internet. Domain name means an alphanumeric string that corresponds to a numerical address on the Internet.[21]A domain name is composed of two parts: a top-level domain name and a second-level domain name. Each top-level domain name can have only one second-level domain name; no two-domain names will be identical. According to the computer system, similar domain names such as sina.com and si-na.com or slna.com are different and can be registered by different people. When register the domain name, the NSI applies the first come, first served policy. And there is no substantive examination procedures exist for domain name application. Because the similarity of domain names that can be registered and because only one entity can have a given domain name, conflicts over domain name availability and usage inevitably arise. As to the well-known trademark concerned, there are three kind controversies: 1. Dilute the well known trademark; 2.cybersquatter; 3, conflict interest between a junior user and prior user.

1. Dilute issue.

Dilution refers to unauthorized acts that tend to blur the distinctiveness of a famous trademark or to tarnish the mark by using it in a disparaging or unsavory way. the Lanham Act 43( c) 1 states that “a commercial use of another’s famous mark or trade name can be enjoined, if it causes dilution of the distinctive quality of the mark.”[22]

    2.Cybersquatting, one party, the so-called cyberquatter, registers the many trademark and trade name with the intent to selling the domain name to the legitimate trademark owner or the trade name owner. Such as in Internmatic, Inc. V. Toeppen, Toeppen registered about 240 domain names with the intent to sell or arbitrage these domain names to make a profit.[23]

    Example of cybersquatting: a US case and a Chinese case

Panavision holds registered trademarks to the name “panavision” and “ Panaflex” in connection with motion picture camera equipment. In December 1995, panavision attempted to register a web site on the Internet with the domain name panavision.com. It could not do that, because Toeppen had already established a web site using panavision’s trademark as his domain name. On December 20, 1995, Panavision’s counsel sent a letter to Toeppen informing him that Panaviaion held a trademark in the name Panavision and telling him to stop using that trademark and the domain name Panavision.com. Toeppon responded by mail to Panavision, stating that he had the right to use the name Panavision.com on the Internet as his domain name. After that, Toeppon offered to “ settle the matter” if Panavision would pay him $13,000 in exchange for the domain name. After Panavision refused Toeppon’s offer, he registered Panavision’s other trademark with NSI as the domain name Panaflex.com. Toeppon’s web page for panaflex.com simply displays the word “ hello”.

Panavision filed this action against Toeppon in the District Court for the Central District of California. Panavision alleged claims for dilution of its trademark under the Federal Trademark Act of 1995, 15 U.S.C.§ 1125 9 c, and under the California Anti-dilution statute.

The court held that since Panavison’s trademark is famous. Toeppen made commercial use of Panavision’s trademarks and his conduct diluted those marks. Panavison was entitled to summary judgement under the federal and state statutes.

   Ikea case[24]

    In this case, plaintiff is Ikea Intel Inc, defendant is Guowang Inc, and the cause of action is unfair competition, trademark infringement. The Beijing Second Intermediate court made the opinion in favor of plaintiff.

    Inter Ikea Inc, is the owner of the registered trademark “IKEA”. it obtained trademark “IKEA” and IKEA, and the figurative trademark along with the registered trademark in Chinese “宜家” for the Chinese commodity category and international commodity category as well as services, with the approval of the Trademark Office of the State Administration for Industry and Commerce in 1983. Outside of China, the company has registered the trademarks “IKEA” and the figurative trademark for many commodities and services in 90 nations and regions including the United States, Great Britain, Canada, France and Hong Kong. But when the company was about to register its domain name on China’s Internet using its trademark “IKEA”, It found that defendant had already registered a domain name “ikea.com.cn”. Thus the company brought this lawsuit to the court.

    The defendant GuoWang company defended itself by saying that the domain name registered by it was granted in conformity with legal provisions by the China Internet Network Information Center (CNNIC) with the authorization from the Chinese government and should be protected by the law. Also defendant stated that its purpose by registering “ikea” was to launch voice mail services on the Internet, and it had put great amount of efforts and investment for its preparation and brand cultivation since November 1997. Besides these arguments, defendant alleged that it knew nothing about the trademark “ikea” owned by plaintiff, and a domain name and a trademark are totally different subject matter and so that the protection for a trademark could not be extend to a domain name.

The first instance court made a judgement in favor of plaintiff. The court reasoned that the Chinese law advocates and protects fair competition and that operators in the market competition should observe the principles of honesty and credibility and follows the generally accepted business ethics. The court held that the trademark “IKEA” should be identified as a famous trademark. According to Clause 1, Article 2 of the Law Anti-Unfair Competition of the People's Republic of China. The court ruled that the domain name, "ikea.com.cn", registered by Guowang Inc. shall cease using the domain name immediately and cancel the domain name within ten days after this ruling takes effects.

Now this case is on appeal, the appellate court has not decided it yet.

When compared these two cases, although the legal reason used by the court is different, but the decision is same: the right trademark owners are entitled the disputed domain, the cybersqutters are ordered to transfer the domain names to the right owners.

3. Conflicting interest between a junior user and prior user. The following is an example of such conflicts.

    Plaintiff in this case is the Procter & Gamble Company, the defendant is Beijing Tide Group. The cause of action is trademark infringement and unfair competition.[25]

Plaintiff alleged it was incorporated in 1905, and is the owner of the registered trademark “Tide”. In 1976, Procter & Gamble Company (Swiss) was granted the trademark “Tide” in China. On August 10, 1992, the “Tide” trademark was transferred to plaintiff, and its validity will extend to May 7,2006. Also plaintiff registered “Tide/ 汰渍” letters and fugitive trademark in China and was approved. On September 6, the Guangzhou Procter & Gamble Company were founded. Procter & Gamble Company licensed the trademark to Guang zhou Procter & Gamble Company. After their joint efforts, the “ Tide” trademark had been famous trademark in China. The company registered the domain name “www. Tide .com”. When it was about to register “ www. Tide. Com. cn”, it found that defendant had registered this domain name in 1994. Therefore plaintiff brought this lawsuit to the court. The court reviewed the evidence offered by the parties, it held that the “ Tide” trademark had been a famous trademark which should be give more protection than general registered trademark. After reviewing the evidence offered by Tide Group, The court held that the evidence offered by Tide Group was insufficient to prove that Tide Group had acquired the privilege right to use the domain name www.tide.com.cn Thus the Beijing Court made a judgement in favor of plaintiff.

In this case, the court held that defendant had actual knowledge that the trademark owned by plaintiff is famous trademark, its conduct had lead to public confusion as to the source of the trademark, thus the public had been mislead and will think there is some association between plaintiff and defendant. That will reduce the distinctiveness of the plaintiff’s famous trademark, and lead to the famous trademark dilution. At the same time, since the technology limit of the Internet, the domain name is monopoly in fact, since the domain name registering system adopts the first come, first serve principle, the plaintiff had been tamped to carry its business on the Internet, thus its opportunity had been derived by defendant.   In all, the court concluded that defendant’s conduct constitutes trademark infringement and unfair competition, and it should be responsible to its conduct.

But I think this case is about the conflict interest between a junior user and prior user, not a trademark infringement and unfair competition case. Here the Guang zhou Procter & Gamble Company is the prior user of the trademark “tide”. Of course, I agree with the court that the trademark tide is a well known mark, but the conduct of the TIDE company is different with the conducts of the cyberaqutters, whose intention is to profit from the domain name, nor it is a issue of dilution of the well-known trademark “tide”. The company’s name is “TIANDI”, it has used the abbreviation “tide” for several years, so it can not say Chinese TIANDI company is intent to free-ride on the reputation of the well-known trademark “tide”, nor can say it registered the domain name in bad faith. Only because the technical reason of the domain name, there only can be a ‘tide’ domain name, thus the conflict arises.   

4 WIPO joint recommendation for the conflict of trademark and domain name

    In the article 6 of the Joint Recommendation about the well-known trademark, it gives some guideline for the solution for the conflict between the domain name and the well –known trademark. It states that “

    A domain name shall be deemed to be in conflict with a well known mark at least where the domain name, or an essential part thereof, constitutes a reproduction, an imitation, a translation, or a transliteration of the well known mark, and the domain name has been registered or used in bad faith.

The owner of a well known mark shall be entitled to request, by a decision of the competent authority, that the registrant of the conflicting domain name cancel the registration, or transfer it to the owner of the well known mark.”[26]

 

Part 3 Brief Introduction to well known trade mark protection in China.

 

    1). Applicable laws and regulations

    Up to now, there are several laws and regulations about the protection of the well-known trade mark, they are the Trademark Act, the Anti-Unfair Competition Law, Temporary Regulations on the Recognition and Administration of Well-known Trademarks of PRC, and the Judicial interpretation about the domain name (which was issued by the Supreme People’s Court of PRC. on 26, June, 2001) 

    2). Definition of the well-known trademark under the Chinese law

    According to the temporary regulations, the well known trademarks refer to registered trademarks which are of high repute and known to the relevant sector of the public.

3). Criteria stated in the Temporary Regulations on the Recognition and Administration of Well-known Trademarks of PRC, for a trademark to be well known

The regulation stated that the following evidentiary documents shall accompany the application for the recognition of a well known trademark:

    1.the sales volume and geographic sales area of the trademarked goods in China;

    2.the major economic indexes (annual output, turnover, profits and market share, etc) of the trademarked goods in the last three years and the ranking among its competitors in the same industry;

    3.The sales volume and geographic area of the trademarked goods outside China.

    4. The coverage of advertisement of the trademark;

    5.The length of use and continuous use of the trademark;

    6.The registration status of the trademark in and outside China.

    7.Other documents that can prove the well known status.

    4). Competent authority and the methods used

    The State Administration for Industry and Commerce of the PRC and the People’s Courts has the authority to determine whether a trademark is well known or not. When the authority determines whether a trademark is well known or not, it applies a case by case analysis.

    5). Brief introduction to the Amendment of China Trademark Law- the relevant articles about the well known trademark protection

China now is seeking the membership of the WTO, in order to meet with the basic principle and the minimum requirement in the TRIPS Agreement; China Trademark law is going through its second revision. Based on draft amendment of the act, the well-known trademark protection issue will be stipulated in the Amendment. Thus will strength the protection of the well –known trademark in China.

    6) Conclusion

There is a long way for China to go, and it is hard to say what kind of protection China law will grant to the well-known trademark in its Trademark Amendment Act until it is promulgated and applied by the courts. We are waiting and pay close attention to its development. But I am sure that it will strengthen the protection of the well-known trademark in China.

 

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