Case No 9: KDF Distribution (Shanghai) Co Ltd sued Aquatherm Pipe System (Shanghai) for trademark right infringement and false publicity

1. Background

KDF Distribution held the rights to the “AQUA-SCIE” trademark, and enjoyed the exclusive right to sell Aquatherm’s pipe products in China before July 1, 2013. After that, KDF terminated cooperation with Aquatherm, and Aquatherm Pipe System (Shanghai) became the new agent. KDF’s registered trademark had only been used to promote Aquatherm’s pipe products. After July 1, KDF continued to hold the trademark and began to use it for pipe products from other companies. Aquatherm Pipe System (Shanghai) commissioned Oushu Co to sell Aquatherm’s products. The two companies used advertising slogans indicating that the AQUA-SCIE trademark has been replaced by Aquatherm and the original trademark had nothing to do with Aquatherm’s products. KDF believed that the two companies’ use of those slogans constituted trademark infringement and misleading advertisement and applied for an order that the two defendants should stop their actions and compensate its loss with five million yuan.

2. Ruling

The Shanghai Xuhui district people’s court dismissed KDF’s claims in the first trial. KDF then appealed to a higher court. The Shanghai intellectual property court held that the AQUA-SCIE trademark was once used to promote Aquatherm’s products, and it was necessary for the two defendants to inform consumers of the changes. Neither defendant, however, acted unreasonably or confused consumers about the origin of the products. It was the proper use of a trademark. The defendants’ use of words was indeed not very accurate, but it wasn’t misleading. Therefore, their actions didn’t constitute false advertising banned by the unfair competition law. The court dismissed the claim and upheld the first ruling.

3. Significance

The case involved standards identifying fair use of trademarks and false advertising. The court focused on the defendants’ subjective intention the way of use, and the possibility of confusion, and decided that it was a proper use of a trademark. It stressed using a broad interpretation of advertising slogans in detecting false advertising, and took into account public attention and cognitive experience. The case sets a precedent in this area.

Case No 10: Shanghai Pafuluo Stationery Co sued Shanghai Art Imagine Stationery Co for copyright infringement

1. Background

Shanghai Pafuluo Stationery’s website homepage featured a dark red background, dynamic white starlight, a copper bell ringing and background music. The company felt that Shanghai Art Imagine Stationery and Shanghai Europe Crocodile Stationery Co had plagiarized its website and infringed on its copyright, so it applied for a court order to have the two companies stop the infringement and compensate it with 223,000 yuan.

2. Ruling

The Shanghai Minhang district people’s court ruled that the two defendants infringed upon the plaintiff’s website copyright and ordered them to pay the plaintiff 30,000 yuan for its loss. The two defendants appealed to a higher court. The Shanghai intellectual property court dismissed the appeal and upheld the first ruling.

3. Significance

This case focused on whether website content arrangement is included among works protected by the Copyright Law. The court held that although the websites in question had many public elements, such as columns and structures, the color, content, display and overall arrangement reflected unique ideas and showed visual art effect. They were original and replicable, and therefore could be counted as works protected by the copyright law. The case ruling is a precedent for other similar webpage copyright protection cases.