Introduction
Intellectual property laws play a crucial role in protecting the rights of individuals and companies in various industries. In this article, we will examine two prominent cases, the Michelin case and the Hermes case, to draw a comparison and explore the implications of trademark infringement and unfair competition in the realm of intellectual property law.
The Michelin Case
The Michelin case involves French tyre manufacturing company Michelin and Chinese chain restaurant operator Shanghai XNG Holdings Limited’s Shanghai Maichilin. Shanghai Maichilin was found guilty of trademark infringement for using the trademark “米芝莲” (pronounced as “Maichilin” in Cantonese), which sounds similar to Michelin’s Chinese trademark “米其林”. The Hubei Higher People’s Court ruled in favor of Michelin, ordering Shanghai Maichilin to immediately cease the infringement and pay RMB 10 million in compensation.
Background of Michelin’s Trademarks
Michelin, a multinational company, had registered the trademarks “MICHELIN” and “米其林” in China for various goods and services, including wheels, tyres, and hotel and restaurant address information. These trademarks were recognized as well-known trademarks by China’s trademark authorities. Additionally, Michelin registered similar trademarks in Hong Kong.
Shanghai Maichilin’s Infringement and Unfair Competition
Shanghai Maichilin, founded in 2013, used the unauthorized “米芝莲” trademark as its enterprise name, shop signboard, and offered franchise services. With 500 chain stores in 150 Chinese cities, Shanghai Maichilin’s unauthorized use of the trademark raised concerns of trademark infringement and unfair competition.
Legal Proceedings and Court Rulings
Michelin filed a lawsuit with the Wuhan Intermediate People’s Court, which ruled in the first instance against Shanghai Maichilin. The Court ordered that Shanghai Maichilin immediately cease using the infringing trademarks, change its enterprise name, compensate Michelin in the sum of RMB 10 million, and publish a clarification statement. Shanghai Maichilin appealed the decision to the Hubei Higher People’s Court, which ultimately issued a decision on 8 November 2023 reinstating the first instance judgment in favor of Michelin.
The Hermes Case
The Hermes case involves the French luxury brand Hermes and a clothing manufacturing company in Guangdong province, China, called Dafeng Garment Factory. Dafeng registered the trademark “爱馬仕” (pronounced as “ai ma shi” in Mandarin), which is the Chinese transliteration for Hermes. Hermes had made multiple attempts to cancel Dafeng’s trademark registration but was unsuccessful. The Beijing Municipality First Intermediate People’s Court ruled against Hermes in its appeal against the decision of the Trademark Appeal Board.
Proof of “Well-Known” Mark Status
One of the key factors that influenced the Court’s decision in the Hermes case was the lack of sufficient evidence to prove Hermes’ status as a well-known mark in mainland China before Dafeng’s registration. Hermes relied on media reports from fifteen years prior, primarily from Hong Kong, which did not meet the requirements of Chinese trademark law. The court emphasized the need for evidence such as sales records and market promotions in Mainland China before 1997 to establish well-known status.
Importance of Chinese Transliteration and Early Registration
The Hermes case highlights the importance of obtaining a Chinese transliteration of a brand’s name and registering it early to avoid trademark disputes. While Hermes had used a similar Chinese transliteration in Hong Kong, it had not registered it with the trademark office of Mainland China. This oversight allowed Dafeng to register the “爱馬仕” (“ai ma shi”) trademark in 1995, causing difficulties for Hermes in reclaiming its Chinese name.
Lessons for Businesses
The cases of Michelin and Hermes provide valuable lessons for companies planning to enter the Chinese market. It is crucial to choose a catchy and appropriate Chinese transliteration for their brand names to prevent potential trademark conflicts. Additionally, companies with international fame should be proactive in securing their Chinese names through early registration to avoid losing their rights to local entities.
The Michelin and Hermes cases illustrate the complexities and challenges associated with protecting intellectual property rights, particularly in the context of trademark infringement and unfair competition. Companies must understand the importance of registering trademarks in relevant jurisdictions, including securing appropriate Chinese transliterations. Furthermore, providing substantial evidence of a mark’s well-known status within the relevant market is crucial for successful protection. By learning from these cases, companies can enhance their strategies for safeguarding their intellectual property rights in the global marketplace.
