At the darkest hour of COVID-19, with its economic downturn and associated trade tensions, what opportunities and challenges do enterprises face in intellectual property protection? Luna Jin reports
When Michael Jordan chose to sue Qiao Dan Sports, a Chinese company, the legendary former Chicago Bulls player never knew that a series of IP disputes involving his name and images would drag on for eight straight years.
In April, the Supreme People’s Court overruled all previous rulings and judgments on the combination trademark of “the silhouette of the player + Chinese characters”, and the trademark would now be re-adjudicated by the Intellectual Property Office, the final step of all 68 trademark disputes between the two sides that have eventually made it to the Supreme People’s Court.
If nothing else, Michael Jordan’s important win in China should have been a blockbuster in the field of IP protection, but it was quickly drowned out by the news surrounding the COVID-19 pandemic. But, despite the pandemic, there has been a lot going on in the field of IP protection in China that should not be ignored.
At the end of 2019, the central government issued its Opinions on Strengthening the Protection of Intellectual Property Rights. Then, early this year, China and the US signed the phase-one trade agreement, ushering in a brief truce to their trade war.
International political dynamics may change rapidly, but the slightest change in intellectual property rights (IPR) trends, an important part of trade negotiations between the two superpowers, plays on the nerves of all parties.
In early March, the China National Intellectual Property Administration (CNIPA) rejected more than 100 applications for trademark registration related to celebrities, and disclosed the information of applicants and agencies.
The celebrities whose names had been maliciously registered included Zhong Nanshan and Li Lanjuan, members of the high-level expert group of the National Health Commission, and Dr Li Wenliang, one of the first whistle-blowers to break the COVID-19 news to the outside world. It has been reported that the name “Li Wenliang” was applied as trademarks under categories of medical equipment, medicine, food, etc.
The rapid response was seen to be the central government honouring the commitment of “combating malicious trademark registration” within the trade agreement.
On 16 April, the People’s Court of Shanghai Pudong New District held that the Chinese brand owner of “NEW BARLUN” had constituted unfair competition, and shall compensate the “New Balance” trademark owner for RMB10.8 million (US$1.5 million).
On 20 April, the CNIPA issued the 2020-2021 Implementation Plan of the opinions. The following day, the Beijing High People’s Court issued the Guidance on the Determination of Damage Standards in Cases of Infringement of Intellectual Property Rights and Unfair Competition, and the Adjudication Standards for Statutory Compensation.
Opportunities, risks and concerns
Liu Zhenshun, general counsel, and general manager of IP department at Hisense Group, predicts that enterprises in China will have many adjustments and changes in its IP strategy. “They will start to pay attention to IP ex nihilo [from nothing], change the mindset from the pursuit of the quantity of IP to the quality of it, and seek to cope with external IP risks instead of merely setting eyes on the protection of their own,” says Liu. “These changes will force enterprises to start strengthening the construction of IP teams, both in the size of the team and the competitiveness of personnel.”
With regard to IPR, in addition to “combating malicious trademark registration”, China and the US also reached consensus in trade talks on the protection of trade secrets and other IP issues related to: pharmaceuticals; patent extension; geographical indications; combating piracy and counterfeiting on e-commerce platforms; combating the production and export of pirated and counterfeit products; and strengthening judicial enforcement and procedures of IP rights.
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