Music Industry Alert: Dissonant Draft of China’s Copyright Law Might Change Tune

Articles 46 and 48 draft version of the amendment of the Copyright Law of March 2012 sounded false in the ears of many musicians in China and abroad. After their respective protests and that of music industry interest groups the National Copyright Association of China (NCA) has decided to revise the draft before the end of the month.

 

 

What is all the noise about? ….

 

 

In ancient China there was a sophisticated alarm system with drums and flags to warn of approaching danger

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Pharma Alert Q&A: Viread China’s First Victim of Compulsory Licensing?

Innovative pharmaceuticals take notice. Reuters’ Tan Ee Lyn asserts that China “overhauled parts of its intellectual property laws” to allow generics companies to start exploiting patented medicines cheaply. In other words allowing compulsory licensing. Tan mentioned one medicine for HIV patients as a possible candidate for compulsory licensing.

 

 

China is known to be looking at Gilead Sciences Inc’s tenofovir, which is recommended by the World Health Organisation as part of a first-line cocktail treatment for AIDS patients, two Continue reading

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Trend Thirsty Thursday: Compensation for Copyright Infringement of Chinese Character Fonts Is Going Up

Remember IP Dragon’s 2007 article about font maker Beijing University Founder Sued Blizzard Over Font Copyright Infringements? In 2011 the Beijing Higher People’s Court decided that Blizzard did indeed infringe five of Founder’s copyrighted fonts. But even though Founder sought 408 million RMB in damages, it was only rewarded 1.4 million RMB. Not enough to cover 2.08 million RMB for litigation expenses. Read here.

On May 28, 2012 there was a the three-day United States-China Intellectual Property Adjudication Conference Organized by the China Law Society. The message of the conference was that fonts need to be classified as computer software and protected by the copyright law, as expressed by Ni Guangnan, an academic. In an interesting China Daily, Li Fusheng is writing: “China had dozens of typeface design companies in the 1990s. Now there are only five, including Founder.”

Zhang Jin, professor at the China University of Political Science and Law was quoted by Li Fusheng of China Daily saying: “If one typeface is original and can be “conceptually” separated from the character itself, it should be eligible for copyright protection. Lu Shan, a judge at the intellectual property tribunal of Nanjing Intermediate People’s Court, said a typeface should be entitled to legal protection as long as it is created independently, looks substantially different from all existing ones and has aesthetic value.”

Gao Fuping, of the School of Intellectual Property at East China University of Political Science and Law advocates that Chinese character fonts be given more protection to boost their development.

Zhang Ping, professor at Intellectual Property Law School of Peking University said that though the sum of compensation in the Copyright Law is likely to double to 1 million yuan it will not be appropriate for all cases. Zhang is referring to the statutory compensation in article 72 of the draft version of the Copyright Law March 2012.

 

 

It is clear that if China deems an industry crucial, such as the Chinese character fonts industry, it is willing to protect and enforce it in a different way as industries it does not view as crucial. So it seems unlikely that there will be a repetition of the low compensation awarded to a company such as Founder when there is a new case of copyright infringement of Chinese character fonts.

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Supreme People’s Court Took AMSC v. Sinovel Wind Group Case On Software Copyright Infringement

In November, 2011, IP Dragon posed the question: Is American Superconductor (AMSC) the 21st century version of Don Quixote?, when it sued Sinovel Wind Group of Beijing for violation of trade secrets and software copyright infringement and demanded damages of 1.2 billion U.S. dollar, read here.

 

 

AMSC has filed four law suits against Sinovel Wind Group, her old customer.

After Hainan Higher Court’s decided on April 5, 2012 to uphold the Hainan Province No. 1 Intermediate People’s Court’s to dismiss AMSC’s law suit against Sinovel Wind Group Co., Ltd. (Sinovel) and Dalian Guotong Electric Co., Ltd. (Guotong) in which it claims 200,000 U.S. dollar in damages.

AMSC gives her rationale for the appeal to the Supreme People’s Court, read here:

 

 

  • Pursuant to AMSC’s contracts with Sinovel, AMSC has turned to the Beijing Arbitration Commission to resolve its contractual disputes. However, AMSC’s Hainan case is purely a copyright infringement dispute rather than a contractual matter. As such, it is independent of the contracts and belongs within the civil court system.”

  • “In November 2011, Sinovel filed a motion on identical grounds to dismiss a separate copyright infringement case from the Beijing No. 1 Intermediate People’s Court, saying the matter should be governed by the Beijing Arbitration Commission. As previously reported, on February 14, 2012, the Beijing court properly denied Sinovel’s motion to dismiss the case. The Beijing No.1 Intermediate Court stated the software copyright infringement dispute between AMSC and Sinovel is not a dispute “arising from, or in connection with the execution of the contract” and should not be sent to an arbitration institution. Therefore, the jurisdiction opposition raised by Sinovel lacks factual and legal basis and is inadmissible.”

  • “Sinovel’s December 2011 opposition motion requested that AMSC’s case against Sinovel be dismissed by the Hainan Province No. 1 Intermediate People’s Court. Guotong, however, never filed a jurisdictional opposition motion of its own. Despite this fact, the Hainan court dismissed AMSC’s case against both Sinovel and Guotong. Indeed, as there is no contractual relationship between AMSC and Guotong, it is impossible to solve the dispute between AMSC and Guotong through arbitration. Moreover, as Sinovel and Guotong are codefendants, it is impossible to separate them so that they would be governed by a court and arbitration commission, respectively.

 

 

Although a court, such as the Hainan Province No. 1 Intermediate People’s Court might favour that legal conflicts are solved via arbitration, AMSC is right that if there is no contract, and there is a copyright infringement case, it should be solved via litigation.

Read also Ehren Goossens Business Week article here. It is not known when the Supreme People’s Court will decide on this case. To be continued.

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Stir up people to innovate by slogan or by a change of culture

“Ask and it will be given to you; seek and you will find; knock and the door will be opened to you”… “Read slogans and you shall innovate.” The last sentence it not according to the Gospel of Matthew, but according to the Gospel of the Beijing Municipal government.

 

 

If you have been in Beijing recently you must have seen Beijing’s campaign that started last Autumn to show the city spirit, see here. Every where you see  the characters 爱国 (àiguó), 创新 (chuàngxīn), 包容 (bāoróng), 厚德 (hòudé). It took the capital 18 months and a survey under 3 million citizens to come up with these eight characters. The slogan that should symbolize the city spirit or the collective wisdom of the city  is criticized by Ye Kuangzheng of the Economic Observer, see here.

 

 

One could say that China needs to move from an imitation country to an innovation country. In that sense one is a patriot if one creates, invents or is doing commerce, for which one can use copyright, patents and trademarks.

At least it shows the capital is eager to stimulate its citizens to innovate. As I have written before, it would be more effective to create a climate where the freedom to experiment is guaranteed, critical thought stimulated and creative thinking valued.

If one applies inclusiveness to innovation, then everyone needs to have a chance to get a good education. Instead of pirating and counterfeiting, creating original works and to critically look at existent technology and invent disruptive new technology would be virtuous.

The Beijinger posted a picture of a campaign poster showing a spirited Beijing family with two children, although the one child policy is still going on), see here.

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Plain Cigarette Packaging Debate Ignited Again in Hong Kong

In the Mainland of China there is still growth in the amount of people that start to smoke; now there are 350 million smokers in China. And a scientist specialised in refining cigarettes to the taste of Chinese smokers, has even been made a member of the prestigious Chinese Academy of Engineering.  Not so in Hong Kong. Here the future of smoking goes slowly out as the light of a burning cigarette. But still the number of smokers in the fragrant harbour is substantial.  According to the University of Hong there are 760,000 smokers in Hong Kong, 380,000 will die of smoker-related diseases, see here. The World Health Organization confirms that half of all smokers will die of smoker related diseases. 7,000 people per year die in Hong Kong because of tobacco.  But if a product is allowed to be sold, is it fair to restrict of even prohibit the use of a trademark on these products? Continue reading

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Trend Thirsty Thursday: Made Better in China

What would you do if you knew the future? Wouldn’t you made decisions that anticipate on that future to be fully prepared? The alchemists over at trendwatching.com have made it their business to extrapolate contemporary facts (as valuable as lead) into projections of the future (as valuable as gold). Then again, trendwatching might not be just  passively revealing existent trends, but when done in a convincing way, it is able to reinforce or create events. Probably a combination is the case with trendwatching.com’s newest trend of the month. Continue reading

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Manchurian Candidate of Chips: Backdoor or IP Challenge?

Instead of brainwashing and grooming a person to become a political leader in a rival country, like in The Manchurian Candidate, a 1959 political thriller by Richard Condon, it is probably easier to try to sell the rival country computer chips with backdoor technology that their military will use. Backdoor technology is an additional undocumented feature deliberately inserted into the device for extra functionality. Military graded chips with a backdoor in missile systems, airplanes or nuclear reactors could be controlled by an external entity from a distance.

 

 

(You do not need a backdoor into IP Dragon to influence us, just filling out this ultra short survey will do, thanks!)

 

 

Sergei Skorobogatov of the Faculty of Computer Science and Technology, University of Cambridge claims that he developed a “QVL technology” that can detect a backdoor in chips, and that he actually found one in a military graded chip, see here. Robert David Graham of Errata Security, which is a cyber security consulting company,  begs to differ Continue reading

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IP Dragon wants YOUR opinion

Dragon photographed in Shenzhen, copyright Danny Friedmann

 

IP Dragon is very excited to announce that it is moving toward a more professional format. To be better informed about your professional needs, we would like you to answer the following 9 short questions.

 

Help us to serve you better and click now here.

 

Thank you, we appreciate it very much.

Danny Friedmann, editor IP Dragon

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This Is How An Australian Company Undercut A Chinese Counterfeiter on Price in Africa

I have written a few times jestingly that companies should be happy when their intellectual property rights are infringed by Chinese companies. Because, if they don’t one cannot easily sue them any longer but one has to compete with them which might be even more difficult. Australian radio and metal-detector manufacturer Codan, is not waiting until the counterfeiters of their product become legit competitors.  Codan started to compete with them on price.  Continue reading

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One of the Top 10 IPR Cases in Jiangsu 2011: Counterfeit Luxury Brands Seized

Wikipedia Jiangsu map

 

 

Jiangsu was China’s province with the highest GNP per capita in 2011:  61,649 Yuan. This means that a greater group of people might have become interested in luxury goods, such as cosmetics and jewelry.  One of the top ten IPR cases in Jiangsu in 2011 according to Zhu Yu, secretary of the Jiangsu People’s Government Provincial Intellectual Property Office was the seizure of 43 outbound EMS parcels by the Nanjing Customs… Continue reading

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Without Real Innovation What Is There To Protect? National Intellectual Property Strategy 2012

China wants to move away from imitation to innovation country. Therefore China’s State Intellectual Property Organization (SIPO) issued the Promotion Plan for the Implementation of the National Intellectual Property Strategy in 2012.  Before I give an analysis of this laudable plan my preliminary thought is this:

Although there are not many China’s State-owned Enterprises, they have assembled huge assets, see here. This means that people in charge of these enterprises have vested interests. And a country that is full of vested interests, and that considers critical thought as a potential danger to social stability and harmony is not a climate conducive to innovation. Because innovation gives birth to disruptive technologies (Schumpeter’s gale: creative destruction). Without innovation, there is only the intellectual property of foreign rights holders to protect and enforce. Besides, innovation is needed for sustainable economic growth which can harness social stability and harmony. From a historical point of view (the greatest inventions came from China) and a statistical point of view applying a Bell curve to a population of 1.3 billion people China must have the most and least innovative people in the world. If there are not enough inventions to be harvested, the ground needs fertilizer: a culture for experimenting and critical thought can do the trick.

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Impersonator Does Not Fake a Documentary on Trademark Counterfeits

Owen Schumacher is a gifted Dutch comedian and impersonator. He has made a documentary series about what people’s perceptions are of real and fake. The third episode of the documentary is on brands, genuine and fake. Mr Schumacher, like yours truly, studied intellectual property law at the Institute for Information Law (IViR) in Amsterdam, the Netherlands. So it is only natural to start his journey into the world of trademark counterfeits at this renowned institute.

 

 

Unfortunately he did not interview anybody at the institute and only showed some examples of counterfeits. In the documentary Schumacher is going to Shanghai to Holland Village which has many replicas of Dutch buildings (at first sight the houses that were shown seemed to be already in the public domain,  so there is no copyright issue here). Then Windows of the World 世界之窗 in Shenzhen was shown, where many of the famous buildings and natural scenery of the world was copied on a miniature scale. Mr. Schumacher visited  Museum Plagiarius in Solingen, Germany together with Christian Rommel, an entrepreneur who build up a collection of counterfeit tissue paper, all variations on the Tempo brand. He also went to Canton Road in Tsim Sha Tsui (TST), Hong Kong to see the megastores of luxury brands  such as Louis Vuitton and Gucci, where people have to queue to get in.  Mr. Schumacher said that only the next street you can buy fake versions of these brands. However, then you saw Mr Schumacher walking at the Ladies’ Market in Mong Kok, which is not located on the next street but you must take the MTR (metro) from TST, via Yau Ma Tei and Jordan to Mong Kok. Then he buys himself a fake Rolex watch, and engages in participatory journalism.

 

 

Also Mr Schumacher stated that there is no place on earth where so many counterfeits are sold. This claim is probably not true. What is unquestionably true is that the place is well known and frequented by foreign tourists.

 

 

For IP Dragon readers, many issues that have been covered extensively are also dealt by the documentary, such as Ikea, see here and here, and Apple stores copycats, here and here, and Shan Zhai culture, see here, here and here is explained by architect Fei Wang.  Since the interviews were done in English and the Dutch voice-over is not adding so much information, it is worth to watch to watch it even though one does not master the Dutch language. See Nep! (which means fake in Dutch) broadcast by NTR here.

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Why Go Undercover If You Can See Counterfeits in the Bright Light of Guangdong

“Sunlight is said to be the best of disinfectants”, as judge Louis D. Brandeis (Supreme Court of the U.S. from 1916-1939) is quoted. But what if some of the government officials in society wear sunglasses?

 

 

Last year around this time I went to Dong Men in Shenzhen, which is part of Guangdong Province. And without any problem I could make photos of how an external disk drive became an Apple disk drive, never mind that Apple does not produce any external disk drives, see here. A year later the same phenomenon can be observed in the open. Continue reading

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Most Feared by Multinational Companies in China: IP Infringers WITHIN the Organization

Phil Muncaster of The Register interviewed via email Verizon manager Ian Christofis after the 13th annual Info-Security Conference in Hong Kong.

 

 

“In my experience, a number of foreign companies – for example US-based or Taiwan-based firms – that are manufacturing in China have particular concerns about loss of IP such as industrial designs from their business units based in China, due to employees leaking information,” he clarified in a follow-up email to The Reg.

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Ownership and the Right to Upload versus the Obligation to Remove

In Hong Kong uploading and downloading copyrighted material without permission by the right owner is illegal

 

 

Hong Kong’s Motion Picture Industry Association (MPIA) estimated to have lost 308 million U.S. dollar, because of copyright piracy on YouTube. Read Karen Chu’s Hollywood Reporter article here.  MPIA is referring that the Hamburger Landgericht’s decision in GEMA versus YouTube should be applied again to illegally uploaded Hong Kong movies. Read more about GEMA v. YouTube  in Brigit Clark’s IP Kat analysis here.  MPIA’s case shines a light on the ownership issue.

It all boils down to … Continue reading

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How To Create A Chinese Alptraum Out of an Austrian Dream Village

Picture a pristine village at a crystal clear lake in the Austrian Alps. Now get rid of the snowy mountains and replace them with yellow hills.  Then strip the lake and substitute it with a muddy pool.  Add some polluted air of Chinese industry for good measure.  Exactly this was done by China Metal Mine Group who copied the whole Austrian village of Hallstatt and built it in Boluo (博罗), Guangdong province, to sell the houses to wealthy Chinese families.  The city of Hallstatt perceived it at first as an Alptraum (=nightmare in German) and considered to pursue legal actions to protect their UNESCO world cultural heritage site against this copycat. Then they changed their mind and use the appropriation by the Chinese project developers as an opportunity… Continue reading

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Trademark Dilution/Delusion in HK: Greyhound Café is free-riding on Greyhound Lines’ Reputation

Greyhound Café, IFC, Central, Hong Kong Island, Photo Danny Friedmann

 

Can the Gaia Group who brought a restaurant chain first in Thailand (in 1997, as a line extension of its fashion label which it started in 1980 with men’s casual wear at Siam Center, followed by an expansion into women’s wear in 1990) the first Greyhound Café and now in Hong Kong with the name Greyhound Café, and use the mirror image of the iconic Greyhound Lines trademark, North America’s largest intercity bus company? Yes, they can. They did. But is it allowed? The restaurant chain’s concept is: “Life is a journey, full of pictures, places, stories, and good tasting recipes.” One asks oneself why the restaurants in IFC in Central and Ocean Terminal in Tsimshatsui cannot make their own journeys, make their own pictures, travel to their own places, come up with their own stories and recipes?

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Majority of Online Copyright Infringers Encourage Chinese Government to Step up Protection

On May 3, 2012, the China Youth Daily did a survey under 17,576 respondents about their conduct and perception in regard to copyright protection.

 

 

Results survey: 

 

 

  • 92.7 percent of respondents admitted they had bought or used pirated goods themselves;
  • 86 percent of respondents hope the government steps up copyright protection;
  • 65.9 percent of respondents said poor copyright protection may undermine authors’ enthusiasm to innovate;
  • 64.2 percent said it could impair the country’s cultural innovation.

Read the Xinhua article via the China Daily here.

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Four Taiwanese Publishers Want Government to Ban Access to Foreign Piracy Sites

Four Taiwanese publishing companies have urged the government to change the Copyright Act and Telecommunications Act, so that there will be a possibility to ban access to foreign sites that provide pirated content.

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China Dominates Priority Watch List 2012

April 2012, the Office of the United States trade Representative published its 2012 Special 301  Report. To really nobody’s surprise China is again on the Priority Watch List, together with Algeria, Argentina, Canada, Chile, India, Indonesia, Israel, Pakistan, Russia, Thailand, Ukraine and Venezuela. Contrary to Jeff Johnson Roberts’ Continue reading

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Bear and Dragon Try the Water for Fast Patent Examination Stream

After the U.S.A (USPTO)., Germany (DPMA), Korean (KIPO) and Japan (JPO), Russia might become the fifth country to have a patent prosecution highway with China.

 

State Intellectual Property Office (SIPO)’s commissioner Tian Lipu signed a Memorandum of Understanding with Boris Simonov, director general of the Intellectual Property Office of the Russian Federation (RFIPO) on a pilot of a patent examination highway between SIPO and RFIPO.

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Why Wen’s Words Are Not For T-Shirts

“Reflect on your faults”

“Keep both feet on the ground”

“Look up at the starry sky” 

 

These slogans seem innocuous and hardly original, nor is it obvious that they are copyrighted or trademarked. However,  the Beijing Administration for Industry and Commerce is investigating whether Vancl 凡客 can no longer use these slogans, because they have been used by Wen Jiaobao, the premier of China. Continue reading

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Analysis of the 2011 Supreme People’s Court White Paper

April 19, 2012, the Supreme People’s Court issued a white paper on intellectual property protection by Chinese people’s courts in 2011.  IP Dragon has made an analysis of the the 64 page document.

The white paper makes the growth of the case load (from around 5,000 cases in 2001 to almost 60,000 cases) in the civil, administrative and criminal courts and the relative numbers in copyright, trademark and patent cases, and high-profile cases.

The growth seems impressive, but in relation to a population of 1.3 billion people, 60,000 intellectual property cases is  maybe not peanuts but pine nuts, which at least has connotations of longevity and immortality. It means there is one intellectual property case in every 21.7 million people.  If one would apply such numbers to a country like Australia with a comparable population  (22.8 million people) it would mean that they would have only one intellectual property case per year.

 

Civil courts

Most cases dealt with copyright law, followed by trademark and patent law.

35,185 were copyright cases, up 42.34% year-on-year;

12,991 were trademark cases, up 53.56% year-on-year;

7,819 were patent cases, up 35.16% year-on-year;

1137 were competition cases (18 were monopoly-related), up 0.53% year-on-year;

557 were technology contract cases, down 16.87% year-on-year;

2,193 were other intellectual property cases, up 11.55% year-on-year.

Incredibly,  for a country of 1.3 billion people the courts admitted only:

186 applications for pre-trial preservation of evidence;

130 applications for preliminary injunction;

20 applications for pre-trial preservation of property.

 

High-profile civil court cases:

  • Gree Electric Appliances Inc. of Zhuhai v. Guangdong Midea Air-Conditioning Equipment Co., Ltd, and Zhuhai Taifeng Electric Appliances Co., Ltd (patent infringement);
  • Guangzhou Hongtaiyang Auto Components Co., Ltd. v. Anhui Jianghuai Automobile Group Co., Ltd and Anhui Jianghuai Automobile Co., Ltd (infringement of the exclusive right to use registered trademark);
  • E-Land International Fashion (Shanghai) Co. v. Zhejiang Taobao Network Co., Ltd. and Du Guofa (trademark infringement);
  • Société Civile de Château Lafite Rothschild v. Shenzhen Jinhongde Trade Co., Ltd. and Health Industry Development Co., Ltd. under Hunan Biological & Pharmaceutical Group (infringement of the exclusive right to use registered trademark and unfair competition);
  • Tencent Technology (Shenzhen) Co., Ltd. and Shenzhen Tencent Computer System Company Limited, v. Beijing Qihoo Technology Ltd., Beijing Sanji Wuxian Network Technology Co., Ltd., and Qizhi Software (Beijing) Co., Ltd. (unfair competition);
  • Beijing Kaixinren Information Technology Co., Ltd v. Beijng Qianxiang Hulian Technology Development Co., Ltd. and Beijing Qianxiang Wangjing Technology Development Co., Ltd. (unfair competition).

 

Administrative courts

Most cases dealt with trademark law, followed by patent law and copyright law.

1,767 were trademark cases, down 12.78% year-on-year;

654 were patent cases, up 18.69% year-on-year;

2 were copyright cases, unchanged from the previous year;

10 were other intellectual property cases.

 

High profile administrative cases:

  • Wei Tingjian and T.C. Pharmaceutical Industries Co., Ltd v. Trademark Review and Adjudication Board of the State Administration for Industry and Commerce (administrative dispute over reconsideration decision on trademark cancellation);
  • Beijing Resources Double-crane Pharmaceutical Co., Ltd. and Xiangbei Welman Pharmaceutical Co., Ltd. v. Patent Re-examination Board of the State Intellectual Property Office (administrative dispute over patent invalidation);
  • France Castel Frères  SAS v. Trademark Review and Adjudication Board of the State Administration for Industry and Commerce and Li Daozhi (administrative dispute relating to a review decision on trademark revocation).

 

Criminal courts

Most cases involved trademark counterfeits. The copyright piracy cases are completely absent.

2,417 involved registered trademarks, such as use of counterfeit marks, up 142.19% year-on-year;

1,747 were intellectual property infringement cases involving the crime of illegal business operations, down 15.93% year-on-year;

774 were intellectual property infringement cases involving the crime of production and sale of sub-standard products, up 29.87% year-on-year;

52 were cases of other nature.

 

High profile criminal case:

  • Ju Wenming, Xu Lulu and Hua Yi, who were convicted of copyright infringement.
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Happy World IP Day from China

Today is World IP Day, the annual day to celebrate intellectual property rights and what they mean for stakeholders and society at large.  It’s organised by the World Intellectual Property Organization (WIPO). This year’s theme is visionary innovators, see here. As an example of such a visionary innovator from China, Ms Tu Youyou (屠呦呦) was mentioned: “Tu Youyou’s dogged analysis of herbal remedies results in a malaria treatment that saves millions of lives.” Ms Tu discovered artemisinin (also known as Qinghaosu) and dihydroartemisinin.
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Hong Kong’s parody on democracy? First pass bill, then consult public on Parody Exception

Some principled linearity please

 

Democracies’ very right to exist depends on the support the government is getting from its population. Hong Kong’s democracy might be in its infancy, but the government of the Special Administrative Region should know that passing the Copyright (Amendment) Bill 2011 without an explicit parody exception and only after that fact consult the public, is almost a parody on democracy, and in contempt of the Hong Kong public. The same has happened in the U.K., but that is no reason to adopt it.

 

The Copyright (Amendment) Bill 2011 is making it an offence to share copyrighted works without permission to make political or socially critical points; satire, parody or social comment. It does not matter whether the copyright holder has complained or not.

 

RTHK The Pulse covered the item on April 20, 2012: “The Bills Committee has supported the resumption of the Second Reading debate on the Bill on 9th May, ” see here (starting from 6 minutes 20 seconds)

 

Chairman of the Committee Copyright (Amendment) 2011 Chan Kam-lam: “If we secretly share materials even with friends, it will directly or indirectly affect the interest of the copyright owners. Therefore we have to handle it carefully. ”

 

Mr Chan seems less concerned about chilling effects to creativity and free expression.

 

Anny Cheng and Jacki Lee of the Concern Group of Rights of Derivative Works say that not all copyright permissions can be obtained.

 

Ms Cheng: “There was a cartoon animation fan. He found a hundred title sequences to create his own little sequence. So does he have to get copyright permission for a hundred cartoons?”

 

Mr Lee: original works and derivative works complement each other.

 

According to Geoffrey Lau, head media & licensing & strategic planning of the Composers and Authors Society of Hong Kong, parody requires consent by both the copyright holder and the parodist. Mr Lau is comparing it like a marriage.

 

Network Freedom Concern Group’s submission to LegCo CB(1)2776/10-11(05), you can find in Chinese here: their concern can be summarized as follows: the proposed Section 39 does not include explicitly parody or satire, and this in combination with the proposed offence of prejudicial communication to the public  Section 118(8B)b.

 

UPDATE 26 April 2012:

RTHK: “The Secretary for Commerce and Economic Development, Greg So, says amendments to the copyright ordinance, which are being scrutinised by the Legislative Council, will not target satire or limit freedom of expression on the internet. There’s been an internet uproar over fears that the proposed changes will make it easier to prosecute online comedians and satirists. Mr So reiterated that there was no need for netizens to be over-concerned.”

 

 

Secretary for Commerce and Economic Development Greg So said that no legislation in the world that can define what parody is. “And some recognise that there might be a difference between satire and parody, and that is precisely why we need to do a consultation to hear from the stakeholders to have a broader perspective, before we decide whether to exam, what to exam, and have a definition. Right now, no one seems to be able to do just that.

 

 

Listen to RTHK’s Wendy Wong here.

Thanks Ron Yu.

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Stolichnaya in China: Absolute Counterfeit

After counterfeit Lafite wine, Chinese counterfeiters have concocted the famous vodka brand Stolichnaya. Stolichnaya does have its roots in Russia, but is now produced in Latvia by SPI Cyprus.

 

China Daily (U.S.  edition) run with Xinhua’s news post which covered an enforcement action by the Tianjin Customs Office, in Tianjin Municipality against counterfeit Stolichnaya vodka. More than 18,600 counterfeit bottles were destroyed. Read here.

 

One way ferry ticket to the sky

 

In the brief article an official with the Tianjin Customs Office, Shi Guowang, is quoted saying: “Such serious case is very rare in China and it shows the country is a victim of piracy, which is a global issue.” Indeed, the scale of counterfeit vodka caught is rare, but the frequency of counterfeit cases in China is not. No word was spent on the considerable health risks involved with counterfeit drinks. These counterfeit vodkas often are made of methylated spirits, which is an industrial alcohol (denatured alcohol), and to distinguish it from alcohol for consumption, the manufacturers color it purple. To get rid of this color, counterfeiters bleach it.  Tianjin’s name in connection with the lethal concoction is suitable. In Chinese Tian 天 Jin 津 means sky ferry.  The two ingredients can on their own “merits” kill you, let alone a combination. Then again, there are vodkas produced by non-counterfeit manufacturers, that will not kill you or blind you directly, unless you finish the whole bottle, that are made purple or are served in a purple bottle, and marketed as a trendy drink.

 

The dramatic expression in the Xinhua article that China is also a victim of piracy is true. And that it is a global issue is also true. However,  one cannot neglect the fact that the majority of counterfeits globally originate from China, and therefore, if one insists on personalizing the role of some to a whole country, as the author of the article does, one must be complete and state that China’s role is victim and perpetrator at the same time.

 

The question remains how to distinguish a potentially lethal counterfeit vodka from an authentic one. There are some ways such as barcodes that can be verified by the purchasers via a picture made by a mobile phone. But even then, the bottle can be real, but the contents poisonous. Therefore, as this author pointed out before, one should always destroy the old bottle. Or providers should make deals with restaurants to return the bottles.

 

Capital punishments is hopefully on its way out in China. Instead some might argue that the counterfeiters of food and drinks should be given a diet of their own products during their prison sentence.

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Constructed Knowledge Works Like a Red Flag To An Internet Intermediary

After publishing a draft of the copyright law, the National Copyright Administration comes now with a A Brief Explanation concerning the Copyright Law of the People’s Republic of China (Revision Draft), translated by China Copyright and Media. It makes the copyright more complete but most things were already known.

 

This time let us look at the safe harbor provisions for network service providers, which were already promulgated in 2006 in the Regulation on the Protection of the Right to Network Dissemination of Information, and will probably be incorporated in the copyright law. The provisions exempt them from civil secondary liability of copyright infringements and related rights infringements. The Chinese safe harbor is broader than Title 17 U.S.C. section 512, Digital Millennium Copyright Act (DMCA) because it also includes the related rights performances and audio-visual recordings, and more narrower than Chapter 2, section 4, articles 12-15 Electronic Commerce Directive of the EU, because the latter applies horizontally, which means to all infringing online material.

 

Since primary and secondary liability is such a colourful subject, this author has used primary and secondary colours to show similarities of concept between the different jurisdictions.

 

DMCA (USA)
transitory digital network communications
system caching
information residing on systems or networks at direction of users
information location tools
non-profit educational institutions

 

E-Commerce Directive (EU)
mere conduit
caching
hosting

 

Network Dissemination Information Regulation (China)
automatic access
automatic storage
information storage space to users, or services to the public
searching or linking services
educational institutions

 

Chinese networks that host can be exempted from civil liability if they have no actual nor constructed knowledge. In the Network Dissemination Information Regulation there is article 22 (1): “Having not known and having no justified reason to know that the works, performances, or audio-visual recordings provided by the service object have infringed upon an other’s right;”

 

In the DMCA the constructed knowledge (Red flag) provision is § 512(c)(1)(A)(ii): limiting liability where, “in the absence of such actual knowledge, [the service provider] is not aware of facts or circumstances from which infringing activity is apparent”.

 

Almost the same wording can be found in the E-Commerce Directive the constructed knowledge provision can be found in article 14 (a): “the provider does not have actual knowledge of illegal activity or information and, as regards claims for damages, is not aware of facts or circumstances from which the illegal activity or information is apparent“.

 

In Viacom v. YouTube, that was decided April 5, 2012 by the Court of Appeals for the Second Circuit, it was formulated eloquently: “The difference between actual and red flag knowledge is thus not between specific and generalized knowledge, but instead between a subjective and an objective standard. In other words, the actual knowledge provision turns on whether the provider actually or “subjectively” knew of specific infringement, while the red flag provision turns on whether the provider was subjectively aware of facts that would have made the specific infringement “objectively” obvious to a reasonable person.”

 

UPDATE: April 8, 2012, translation of Copyright Law of the People’s Republic of China has been uploaded on China Copyright and Media here, and includes:

 

Article 69: “When network service providers provide storage, search, linking and other purely technological network services to network users, they do not bear a duty to examine for information concerning copyright or related rights.

 

Where network users utilize network services to conduct activities infringing copyright or related rights, the infringed person may notify the network service provider in writing, and require it to adopt necessary measures such as deletion, shielding, breaking links, etc. Where the network service provider adopts the necessary measures timely after receipt of the notification, it does not bear responsibility for compensation; where it does not timely adopt the necessary measures, it bears joint responsibility with the said network user.

 

Where network service providers know or should know that network users use their network services to infringe copyright, and do not adopt necessary measures, they bear joint liability with the said network users.

 

Joint liability suggests the same gravitas as the liability of a primary infringer. This might be different from the U.S. and EU secondary liability.

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Rouse: IP China Express 340

IP in China, dusk or dawn?
Photo: Danny Friedmann

In the 340th IP China Express Rouse, the international IP business selected the following news items:

– Rubber products manufacturer Freudenberg victorious in a trademark conflict that has been going on since 2002. Finally the Trademark Appeal Board rejected the Chinese firm that wanted to register the same Freudenberg trademark.
–  Liu Binjie, head of the General Administration of Press and Publication, part of the National Copyright Administration, ” with the rapid development and wide application of high technology (especially digital technology and network technology), the system of Copyright Law has faced formidable challenges , therefore July 13, 2011, China has started to prepare its third amendment of its copyright law.
– Beijing First Intermediate People’s Court decided that Procter & Gamble’s use ‘飘柔’ (Rejoice) in the Founder Qian typeface did not infringe Founder’s copyright. Selling the software to Procter & Gamble implied consent that they could use it.
– Although Beijing-Shanghai High Speed Rail was using technology imported from both the East Japan Railway Co. Ltd. and Kawasaki, the technology that it was seeking to patent was innovative. Therefore since 2009, China North Vehicle Group and China Academy of Railway Sciences have begun applying for patents abroad.
– Rouse also gives a summary of the 2006-2010 White Paper on Intellectual Property cases involving foreign parties published by Shanghai Second Intermediate People’s Court. Read IP Dragon’s May 17, 2011 article about it here.

Read the Rouse’s IP China Express here.

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Chinese Movie Posters Give You “Double Vision” Without The Alcohol

Clone and Original
The silver screen is known to bring out the imagination of people. However, China’s film industry has not given birth to a poster child of creativity, eyeing laboriously to any movie that has some measure of success, Chinese or foreign, and subsequently clone the film poster designs.

In November of 2011 I had my doubts about the independent creation of a Taiwanese movie poster, see here. Now Jing Gao of Ministry of Tofu has a series of 41 pairs of copycats and their originals, see here.

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Hausse of Chinese Companies Protecting Their Inventions Overseas

+ 33.4%
Some international patent filings statistics from Geneva. The amount of international patent filings of Chinese companies and educational institutions grew with a stunning 33,4 percent in 2011 to 16,406. This means that more and more Chinese companies and educational institutions value overseas patents to protect their inventions. The U.S. still leads the applications with 26.7 percent of the total share, followed by Japan (21.4 percent), Germany (10.2 percent) and China (9 percent).

Please note that there is no such thing as an international patent. Under the Patent Cooperation Treaty (PCT) you can file a standard national or regional patent application (international patent filing), and designate one or more countries. After that each jurisdiction decides whether or not to grant you a patent for that designated country. The moment of the international patent filing establishes the filing date for all designated countries. 18 months after the filing date or the priority date, the international application is published by the International Bureau at the World Intellectual Property Organization (WIPO) in one of ten languages, which includes Chinese. In case the international patent application only designates the U.S., this publication is not automatically published.

Since January 1, 1994 China is a member the PCT. China’s State Intellectual Property Organization is one of 16 institutes which offers the services of the International Searching Authorities (ISA) and International Preliminary Examining Authorities (IPEA).

There are 4 Chinese companies in the top 100 of companies that filed the most PCT applications.
1. ZTE Corporation 2826 applications
3. Huawei Technologies Co. Ltd. 1831 applications
4. Huawei Device Co. Ltd. 327 applications
87. Alcatel Shanghai Bell Co. Ltd. 176 applications

Of the educational institutes there is only one Chinese institute that secured a position in the ranking. With 36 international patent applications Tsinghua University in Beijing landed a shared 493rd position with Korean institute Postech Foundation, University of Pittsburgh and Danmarks Tekniske Universitet.

See WIPO’s press release here.

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Google And the Law, The Book

Did Google go too far … or is Google victim of legal lag?

Yours truly had the honour to write a chapter for a very promising book called Google and the Law edited by Dr. Aurelio Lopez-Tarruella, of which I have so far only read my own chapter. But the colleagues I know are all very knowledgeable in their respective fields and we all share a passion for the law. Hope I will see them soon and meet the colleagues I have not met before.

My chapter ‘Paradoxes, Google and China‘ is about the blessings of intellectual property and the evil of censorship, two subjects about which both Google and China had some issues. I forgot to place a disclaimer at the end of my chapter, which should have said: I used Google when researching the chapter and enjoyed the hospitality in Shenzhen at the same time.

The text of the publisher is:
Google has proved to be one of the most successful business models in today’s knowledge economy. Its services and applications have become part of our day-to-day life. However, Google has repeatedly been accused of acting outside the law in the development of services such as Adwords, Google books or YouTube. One of the main purposes of this book is to assess whether those accusations are well-founded. But more important than that, this book provides a deeper reflection: are current legal systems adapted to business models such as that of Google or are they conceived for an industrial economy? Do the various lawsuits involving Google show an evolution of the existing legal framework that might favour the flourishing of other knowledge-economy businesses? Or do they simply reflect that Google has gone too far? What lessons can other knowledge-based businesses learn from all the disputes in which Google has been or is involved?

This book is valuable reading for legal practitioners and academics in the field of information technologies and intellectual property law, economists interested in knowledge-economy business models and sociologists interested in internet and social networks.

Table of contents

1 Introduction: Google Pushing the Boundaries of Law . . . . . . . . . . 1
Aurelio Lopez-Tarruella
2 The Power of Google: First Mover Advantage or Abuse
of a Dominant Position? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Sophie van Loon
3 Google AdWords: Trade Mark Law and Liability
of Internet Service Providers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Jeremy Phillips
4 Google and Personal Data Protection . . . . . . . . . . . . . . . . . . . . . . 75
Bart van der Sloot and Frederik Zuiderveen Borgesius
5 Google News and Copyright . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
Raquel Xalabarder
6 Copyright Issues Regarding Google Images and Google Cache . . . 169
Miquel Peguera
7 The ‘‘Viacom v YouTube’’ Litigation and Section 512(c) DMCA:
When the Safe Harbour Becomes a Permanent Mooring . . . . . . . . 203
Annsley Merelle Ward
8 Looking Beyond the Google Books Settlement. . . . . . . . . . . . . . . . 239
Gary Rinkerman
9 Google Chrome and Android: Legal Aspects
of Open Source Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259
Malcolm Bain
10 Google, APIs and the Law. Use, Reuse and Lock-In . . . . . . . . . . 287
Andrew Katz
11 Paradoxes, Google and China: How Censorship can Harm
and Intellectual Property can Harness Innovation . . . . . . . . . . . . 303
Danny Friedmann
12 The International Dimension of Google Activities: Private
International Law and the Need of Legal Certainty. . . . . . . . . . . 329
Aurelio Lopez-Tarruella
13 In Search of Alterity: On Google, Neutrality and Otherness . . . . 355
Marcelo Thompson

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Do Trademarks Killl? Or Are They Victim? A Hong Kong Story With A Happy Ending

Florence Ka-Yee Lam, lawyer at Wilkinson & Grist which was already founded in 1860, wrote an interesting legal brief for IAM magazine on a current decision by the trademark registry of Hong Kong that upheld the registration of Philip Morris’ trademark Marlboro Lights, see here.

When one reads the original decision of the Trademark Registry of Hong Kong one can ask why this relatively simple case had to take around 5 years before a decision was taken. The application for revocation was filed September 22, 2006 and an amended version was filed December 11, 2006.

Annelise Connell asked the Trademark Registry of Hong Kong to revoke trademark Marlboro Light, based on Caption 559 Section 52 Trade Marks Ordinance:

“(2) The registration of a trade mark may be revoked on any of the following
grounds, namely –
 …
(c) that in consequence of the use made of it by the owner or with his
consent, in relation to the goods or services for which it is registered, the 
trade mark is liable to mislead the public, particularly as to the nature, 
quality or geographical origin of those goods or services: or …

Ms Connell’s arguments are that the word “lights” in combination with cigarettes gives the false impression that Marlboro Lights are less harmful than Marlboro Red or other Marlboro cigarettes that do not contain the descriptor “lights”. Research has shown that light cigarettes are no less harmful, but that the perception amongst smokers is that Marlboro Lights cigarettes are less harmful. This perception might be based on  news about machine tests that measured that tar output of lights cigarettes was lower. However, humans are no robots, and managed to inhale more tar than could be measured with robots.

Ms Ling Ho, of Clifford Chance argued successfully for Philip Morris, that no distinction, in terms of health warnings to be applied to all cigarettes packs of all types of cigarette sold in Hong Kong since 1982, had ever been drawn between tobacco products producing lower tar yields and others.
According to the registrant, the applicant did not show sufficiently a serious risk for an average consumer, who is deemed to be reasonably well informed, reasonably observant and circumspect. In other words the registrant asserts: people know that smoking is bad for your health, all smoking. This is an important point, because deception has two parties, the deceiver and the one that is or is not susceptible for the deception.

Section 52 (2)(c) starts with “that in consequence of the use made of it by the owner or with his consent”. According to the registrant, the public health authorities were responsible for the erroneous belief that low tar cigarettes are less harmful to health. 
Ms Lam writes: “Thus, even assuming that the use of the subject mark was liable to mislead the public, the applicant had also failed to establish that the alleged deceptiveness of the mark was the consequence of the use made by it by the registered owner.” 
Trademarks are just as kitchen knifes, which can be used by third parties in a culinary or in a homicidal way. 
Time for slogans
This Marlboro Lights case reminds me of the former city marketing slogan (trademarked) of the Hong Kong Tourism Board: Hong Kong, The City of Life! Isn’t this deceptive? If, out of every 100,000 deaths in Hong Kong, 43 can be blamed on air pollution? I suggest the following slogan: Hong Kong people should get rid of pollution before pollution gets rid of Hong Kong people. Read more hereHong Kong City of Fatal Attractions might be better? My beloved Hong Kong has now chosen, together with many other Asian cities I am sure, for the more generic Asia’s World City. I know HK can do better than this.
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Current State On Writing On Counterfeiting in China

Comment on comment
Neil Wilkoff, blogger of IP Finance, commented on an Economist article, called Pro Logo: Brands in China (January 14, 2012) see here, that did not give enough context nor support for its assertions. The first part of the article is about the backlash the Chinese furniture company DaVinci got after it was revealed that their “Italian” products were made in China then shipped to Italy and reimported back to China. The media Schadenfreude was probably created because the company stressed to be the real thing. So far, I was thinking that only the subtitle of the Economist article Chinese consumers are falling out of love with fakes was made by an editor that might have read the article diagonally. But then the following assertion was made: “Whatever the truth behind this murky affair, it has revealed something about how the attitudes of Chinese consumers are changing. Counterfeiters are no longer popular. Not long ago, Chinese shoppers applauded the fakers for saving them money. Now they scorn them. If it’s a fake, the well-heeled sneer, you can’t flaunt it.” I agree with Wilkoff that these assertions and those made later in the text miss enough context, and are not substantiated by enough facts. In der Beschränkung zeigt sich der Meister as Goethe once said. Therefore it might have been better if the Economist article would have restricted itself to retell the tale of the rise and fall of DaVinci, although this story broke already in July 2011, see IP Dragon’s article here.

Bold statements are nice in times of love, war and sports, but otherwise it might be preferable to add words such as might, could and would in case one poses hypotheses. So the sentence “Counterfeiters are no longer popular”, could be changed into “Counterfeiters might no longer be popular”. And of course in talking about China specificity is well served if questions are answered such as who, what, where, when, why and how. But the Economist might already know this.

Read Neil Wilkoff’s comment here.

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Precious Lessons Learned From Hermès’ Unregistered Trademark In China

Love for horses, Love for gems
Although Hermès registered its trademark in China since 1977, it had not yet registered its Chinese name 爱马仕 (Ài mǎ shì) as a trademark the Legal Evening News wrote, according to Shanghai Daily, see here.
In 1995 Dafeng Garment Factory registered a trademark 爱玛仕 (Ài mǎ shì), which is, indeed, pronounced exactly the same as the Chinese name of Hermès. 
In that year Hermès filed an objection at the Trademark Review and Adjudication Board (TRAB) of the State Administration for Industry and Commerce (SAIC). However TRAB approved Dafeng Garment Factory’s registration in 2001. After that Hermès appealed at a Chinese court. 

In 2009, Hermès again appealed to the board, saying its Chinese name enjoyed a high reputation around the world and demanding the board cancel the disputed trademark. However, Hermès’ application was rejected for a second time May 2011.

Lessons to be learned:

  • Protect your trademark name together with the Chinese version of your trademark, otherwise either the public will come up with a, possibly not so positive Chinese name, or worse a competitor will take unfair advantage of your reputation and/or will confuse the public into believing that your company is the origin of the products of your competitor.
  • Unregistered trademarks can be protected only if they are famous/well-known. That is famous in China, not in other countries, and not even in Hong Kong or Macau which are special administrative regions with their own jurisdiction. 
  • You have to proof that your trademark is famous, before the trademark dispute. Because otherwise it is hard to proof that the public knows your trademark or that of your competitor who is using an identical or similar trademark.
Unfortunately for Hermès, the luxury good company could not convince the court that the Chinese version of its name 爱马仕 was unregistered but a famous name for some time before Dafeng Garment Factory even started using their registered trademark 爱玛仕. They used evidence that originated from the period after the dispute and they used evidence that showed that their trademark was famous to consumers in Hong Kong instead of the mainland. 

Spot the Difference In The Chinese version of the Hermès Trademark And Its Clone
爱马仕
爱玛仕
Top row
Hermès’ unregistered trademark: 爱马仕 (Ài mǎ shì = love horse officials = officials who love horses)


Bottom row
Dafeng Garment Factory registered trademark: 爱玛仕 (Ài mǎ shì = love agate officials = officials who love agate). The difference is indeed, the second character which is 王 wáng (king) + 马 mǎ (horse)= 玛 mǎ (agate), a kind of gem.
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Supporting Qiaodan Brand Is Not Patriotic, But Harmful To China

An iconic photo of Michael Jordan getting the basketball was made into a mirror-like silhouette logo, and then used with the phonetically similar name 乔丹 Qiáodān, and both the logo and name were trademarked in China without Michael Jordan’s permission.

The most iconic basketplayer ever, Jordan, is going to protect his name, his identity and the Chinese consumer against a Chinese company that has made a business of his name by taking advantage of his reputation. 
In a video on his site The Real Jordan Michael Jordan said: “I have established a name, likeness, identity, that represents me personally. When you see the Jordan brand it is a direct connection of who I am, Michael Jordan. I have always thought that my name means everything to me and is something that I own. If someone takes advantage of that, or misrepresents that, I think it is up to me to protect that. I think that is for everyone, not just Michael Jordan, globally all over the world, when you have your name it is your DNA.” 
Stan Abrams points to article 31 Trademark Law that has been applied by Yao Ming and Yi Jianlian, see here
Article 31 Trademark Law: An application for the registration of a trademark shall not create any prejudice to the prior right of another person, nor unfair means be used to pre-emptively register the trademark of some reputation of another person has used. 
Chinese Radio International (CRI), the website of China’s state radio published an article written by Fuyu entitled “Linsanity” Offers Entrepreneurs a Chance to Cash In. The article is writing about pre-emptively registering a trademark of reputation of another person as something commendable. Fuyu writes about Yu Minjie, who registered in 2011 the trademark “Jeremy S.H.L (Shu-How Lin) when Jeremy Lin just entered the NBA: Using her sharp business acumen, Yu immediately recognized Lin’s business value when she saw him play basketball on television, prior to Lin becoming famous.” And of course Lin’s reputation is short, but Lin should be able to make use of article 31 Trademark Law too.
Fortunately there is also information coming from China that does not accept this pre-emptive practice. The video below covers a survey at Sina website. They asked 59,279 people if they think the 乔丹 Qiaodan brand deceives the public. 78.6 percent agreed, and 16.2 percent did not agree.
The presenter 白岩松 Bai Yan Song asked: “If 乔丹 Qiaodan would win, does it means the company would win?” Bai gave the answer: “No, even if they win in the lawsuit, they will still lose, because they are cheaters in the eye of the consumer.

A boy said that if the 乔丹 Qiaodan will win the lawsuit, it will improve the position of this company in his mind. Then the reporter asked why? He replied: “乔丹 Qiaodan must win, because it is our national brand.” A girl asked: “If the company was wrong, why the original Michael Jordan brand never sued them before?”

The presenter said: “I’m really worried about what the boy in the street said. If so many people think like him, it is not patriotic, but harmful to our nation. We should have greater expectations of China, not just stop Shanzhai products, such as these fake Jordans or iPads.

Thank you Michelle for pointing me to this video, which is in Chinese but in which Michael Jordan talks English.

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iPad, youPad, wePad? Who Is the Owner of the Trademark in China?

iPads for sale in the Apple Store at Central, Hong Kong
 Photo Danny Friedmann
Apple introduced a third category, in between a laptop and smartphone, on January 27, 2010 (see the late Steve Jobs give the presentation here and demonstration here and here). April 3, 2010 it was intoduced in the U.S. and one month later in other places around the world. Two months later already a million of these devices were sold. And according to Reuters, Apple has sold 15.43 million iPads in the last 14 weeks of 2011.
So Jobs vision became reality. But how to name this third category? 
… and we call it the iPad. 
That other companies had already registered the name iPad in some jurisdictions could be solved, so the thinking went. For this purpose Apple set up a special purpose company to acquire these trademarks in all relevant jurisdictions. The name of the company IP Application Development Limited is interesting, because abbreviated it is IPAD Ltd. 
In the acquisition process, or rather effort to assign the trademark, a mistake was made. IPAD Ltd. and Proview Holdings, Proview Electronics (Taiwan) and Proview Technology (Shenzhen) entered into a written agreement, December 2009, whereby they agreed to sell, transfer and assign the Chinese trademark of iPad to IPAD Ltd. for £35,000. However, in the written agreement Proview Electronics (Taiwan) pretended to be the proprietor of the trademark and “assigned” the trademark to IPAD Ltd. But the real proprietor was Proview Technology (Shenzhen). John Paczkowski seems to have gathered some of the documents, see here. Then Proview Technology (Shenzhen) started to try to enjoin the sale of iPads in China for alleged infringement of their iPad trademark, and was successful in cities such as Shijiazhuang and Huizhou, according to David Levine in an article for Reuters. Or, if Apple wanted to avoid getting banned from the Chinese shops and gain control over the iPad trademark, they had to pay 10,000 U.S dollar. 
Also it became clear that Proview Technology (Shenzhen) had lodged applications with the Trademark Office, part of the State Administration for Industry and Commmerce, to transfer the Chinese iPad trademarks to Yoke Technology on May 7, 2010. 
The mistake by IPAD Ltd/Apple could have been easily prevented. If you go to Trademark Search of China’s Trademark Office, part of State Administration for Industry and Commerce, and type in IPAD in class international trademark 9, you will see that Proview Technology (Shenzhen) registered the trademark January 10, 2000, see registration number 1590557 and that the effective period of exclusive right: June 21, 2011-June 20, 2021, however, it seems to be repealed because of non-use for three years). Also Proview Technology (Shenzhen) has registered the stylized version of the trademark, international trademark class 9, under registration number 1682310, application date September 19, 2000. Effective period of exclusive right: December 14, 2001- December 13, 2011. Continued after objection. So at least IPAD Ltd could have easily found a starting point to trace who owns the iPad trademark for international trademark class 9. 
Everybody knows Apple these days, but Proview used to be famous too. Proview Group is a producer of display devices, which  include LCD monitors, CRT monitors and flat-panel digital products. It has operations and offices around the world, including Taiwan, Mainland China (Shenzhen and Wuhan), Hong Kong and Europe. Proview Holdings was incorporated in Bermuda and is listed on the Hong Kong Stock Exchange. Proview International Holdings Ltd was the first Taiwanese technology company to list in Hong Kong, and was quite successful. In 1999 it teamed up with U.S. chip maker National Semiconductor “to launch the I-PAD, a stripped-down desktop computer whose main selling points were its Internet connectivity and ease of use.” Then Proview was hit by the financial crisis and May 12, 2010, the Hong Kong Stock Exchange issued a notice that trading of Proview Holdings’ shares had been suspended. Read here Jeremy Wagstaff and Lee Chyen Yee’s Reuters article on Proview’s rise and demise, see here.
Timeline
May 20, 2011, Apple Inc. and IPAD Ltd filed a lawsuit in Hong Kong against Proview International Holding Ltd, Proview Electronics Co (Taiwan) Ltd, Proview Technology (Shenzhen), Yang Rong-Shan (founder of the Proview Group and  chairman and CEO of Proview Holdings who was adjudicated bankrupt on August 2, 2010) and Yoke Technology (Shenzhen). The Hong Kong case reveals many of the relevant facts: High Court Of The Hong Kong Special Administrative Region Court Of First Instance, Action no. 739 of 2010  (HCA739/2010). On June 28, 2011 the Poon J. (潘兆初法官), decided and July 14, 2011 he motivated his decision to allow  the interlocutory injunction and restrain the defendants to “sell, transfer, assign, otherwise dispose of and/or give good title” to the Chinese iPad trademarks. 
May 24, 2010, Apple instituted proceedings against Proview Technology (Shenzhen) in the Shenzhen Intermediate People’s Court and filed an application for Asset Preservation Order (APO) in respect of the Chinese iPad trademarks. June 12, 2010 the application was granted on 12 June 2010, subject to the APOs obtained by some other Mainland banks.

Proview Technology (Shenzhen) has started suing Apple resellers at the Shenzhen Futian District Court (December 30, 2011) and Huizhou Intermediate People’s Court (January 7, 2012), read Katrin Hille’s FT article here and about Apple losing there here, at Stan Abram’s China Hearsay.

According to Shenzhen Media People’s Court Apple lost its trademark ownership on December 6, 2011, see Huang Mengren’s article here. Apple decided to appeal at the Guangdong Higher People’s Court.
February 22, 2012, there was a trademark infringement case between Proview and Apple at the Shanghai  Pudong New Area People’s Court. Apple was successful to the extent that Apple’s iPads were not banned from the shelves. But as Stan Abrams of China Hearsay made clear, see here and here, the real question is who owns the iPad trademark. This will be decided at the Guangdong Higher People’s Court, February 29, 2012.

In the mean time Proview Electronics (Taiwan) has accused Apple of fraud in a lawsuit filed at the Superior Court of California, County of Santa Clara. See here. However, in contrast to trademark lawyer Martin Schwimmer of The Trademark Blog, who was quoted by David Levine responding to the case: “I have never encountered this level of ruse“, see here: I think it is not so strange nor unusual if you set up a special purpose company for the acquisition of a name such as iPad. Especially since iPhone is so ubiquitously known that if Apple pursued the trademark iPad, it would have definitely driven up the price, as this case proofs: from 35,000 pounds to 10 million U.S. dollars. There is no legal requirement to disclose the reason why you want to buy a trademark. Or is there?

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SPC Notice: Full Exertion of IPR Adjudication Functions to Promote the Boom, Socialist Culture and Autonomous and Harmonious Development

16 December, 2011, Supreme People’s Court of the People’s Republic of China issued the notice to fully play the role of IPR judicial functions to promote the great development and prosperity of socialist culture and the promotion of economic autonomy to coordinate the views of developing a number of issues “最高人民法院印发《关于充分发挥知识产权审判职能作用推动社会主义文化大发展大繁荣和促进经济自主协调发展若干问题的意见” [Zuìgāo rénmín fǎyuàn yìnfā “guānyú chōngfèn fāhuī zhīshì chǎnquán shěnpàn zhínéng zuòyòng tuīdòng shèhuì zhǔyì wénhuà dà fāzhǎn dà fánróng hé cùjìn jīngjì zìzhǔ xiétiáo fāzhǎn ruògān wèntí de yìjiàn = Opinions on Several Issues Member ‘s Concerning the Full Exertion of the of IPR Adjudication the Functions to Promote the Boom, of Socialistic Culture and Promote the Autonomous and Harmonious Development of Economy]. 
Read here in Chinese and here a translation in English from China Copyright and Media, and a comment will follow.
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China’s Influence On Non-Trade Concerns In International Economic Law

Maastricht University, Faculty of Law

Professor Paolo Farah organised with a grant from China-EU School of Law (CESL) in Beijing three conferences on China and Non-trade Issues. The first was held at the University of Turin (November 23-24, 2011), the second at Tsinghua University and the third was hosted by the Faculty of Law of the Maastricht University, the Netherlands, January 19-20, 2012.

Hall of fame at Maastricht University, Faculty of Law

The papers of the speakers presented will be collected in a book edited by Professor Farah called “China’s Influence on Non-Trade Concerns in International Economic Law“, will be published by Ashgate Publishing (UK), forthcoming in 2012. Beside the English version, there will be an Italian, Hungarian and Chinese version of the book, thanks to the CESL in Beijing.

Law scholars at Faculty of Law, Maastricht University

Professor Farah describes what non-trade concerns of international trade are and why they are of crucial importance: “Both public opinion and policy makers fear that international trade, in particular a further liberalization thereof, may undermine or jeopardize policies and measures on a wide variety of issues, for example, the protection of the environment and a sustainable development, good governance, cultural rights, labour rights, public health, social welfare, national security, food safety, access to knowledge, consumer interests and animal welfare.” The list is not exhaustive and includes intellectual property rights.

Professor Paolo Farah
This author had the honour to present his paper ‘Rise and Demise of U.S. Social Media in China’ at the last conference hosted by the Faculty of Law of the Maastricht University. It is about how U.S. social media sites such as Facebook, Twitter and YouTube were cloned by Chinese social media sites, RenRen, Sina Weibo and Youku, then blocked from China, and then the Chinese clones got funding in the U.S. at the New York Stock Exchange or NASDAQ.
Speakers from right to left
Professor Anselm Kamperman Sanders, Arianna Broggiato, Danny Friedmann, Rogier Creemers

On January 19, the programme for experts included:
Professor Farah of the University of Turin and visiting scholar of Harvard Law School (East Asian Studies) and Professor Thomas Christiansen of Maastricht University, Political Science Faculty of Arts and Social Sciences, discussed the EU External Action toward China on Non-Trade Concerns in International Economic Law.

Professor Thomas Christiansen

Sergi Corbalán, Executive Director of the Fair Trade Advocacy Office (FTAO) in Brussels, was talking about fair trade and the new EU policies on Corporate Social Responsibility and Development.

Sergi Corbalán

Benjamin Barton of King’s College of London, gave a presentation about the EU, China and international development.

Benjamin Barton

Professor Anselm Kamperman Sanders of the Faculty of Law of Maastricht University gave a presentation on China-EU Relations in the Field of Intellectual Property Law. He is not only Intellectual Property Law, Director of the Advanced Masters Intellectual Property Law and Knowledge Management (IPKM LLM/MSc), and Academic Director of the Institute for Globalisation and International Regulation (IGIR), but also Director of the Annual Intellectual Property Law School and IP Seminar of the Institute for European Studies of Macau (IEEM), Macau SAR, China.

Professor Anselm Kamperman Sanders

Arianna Broggiato, BIOGOV UNit, Université Catholique de Louvain, Centre for the Philosophy of Law (CPDR) talked about Genetic Resources and Traditional Knowledge at the Crossroads of Intellectual Property and the Environmental Regime.

Rogier Creemers, who made a transfer from Maastricht University to the Centre of Socio-Legal Studies at Oxford University presented his paper called Cultural Products and the WTO: China’s Domestic Censorship and Media Control Policies. Rogier has an interesting blog called China Copyright and Media.

Rogier Creemers

On January 20, the programme focused on public health, product and food safety and consumer protection. Lukasz Gruszczynski of the Law Institute of the Polish Academy of Science talked about product safety in the framework of the WTO agreement on Technical Barriers to Trade.

Lukasz Gruszczynski

Denise Prevost of Faculty of Law of the Maastricht University discussed her paper Health Protection Measures as Barriers to EU Exports to China in the framework of the WTO Agreement on Sanitary and Phytosanitary Measures.

Denise Prevost

Enrico Bonadio of the Law School of the City University of London presented his paper on Plain Packaging of Cigarettes and Public Health under the TRIPs Agreement.

Enrico Bonadio

Paolo Vergano of FratiniVergano European Laywers in Brussels gave a Practitioner’s Perspective on Specific Non-Trade Concerns in the Areas of Food Safety and Consumer Protection: A Comparative Analysis of WTO Notifications.

Paolo Vergano

Lorenzo di Masi presented his paper on The Protection of Public Health and Food Safety in East Asia Regional Trade Agreements (RTAs): ASEAN and China.

Lorenzo di Masi
Maastricht city on the banks of the Maas
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Future President China Mentions IPR First As Sino-U.S. Challenge

Xi Jinping, Vice President of PRC
probably the next President of China in 2012

Xí Jìnpíng 习近平, China’s vice president, and probably the successor of Hu Jintao as president in 2012, wrote to the Washington Post in response to some specific questions an overview of Sino-U.S. relations over the last 40 years, plus a look into the future.

It is telling that Mr Xi started with IPR when he wrote about the challenges the U.S and China have:
We have taken active steps to meet legitimate U.S. concerns over IPR [intellectual-property rights] protection and trade imbalance, and we will continue to do so. We will continue to press ahead with the reform of the RMB [renminbi] exchange rate formation mechanism and offer foreign investors a fair, rule-based and transparent investment environment. At the same time, we hope the United States will take substantive steps as soon as possible to ease restrictions on high-tech exports to China and provide a level playing field for Chinese enterprises to invest in the United States.

Read Xi Jinping’s text in the Washington Post here (quote about IPR on page 2, see here).
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“Chinese Government Takes IP Dead Serious”

“The government is taking IP dead seriously,” says Danny Friedmann, an IP rights consultant in China and founder of the popular blog IP Dragon. “In fact their fate is connected to it.”

Read Melissa Maleske’s InsideCounsel article ‘China aims to strengthen IP rights enforcement‘.

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Must Read of the Month: Subject of the Emperor Filed Enhanced Nutcracker Patent in U.S. and Canada

Mark Cohen, IP in China expert, who is now a visiting professor at Fordham Law School, has a great blog called ChinaIPR.com. He recently posted the most fascinating article post of the year: China’s First Overseas Patent Filer written by Scott Seligman, who was assisted by Mr Cohen on patent law. Read Mr Seligman’s book Three Tough Chinamen will be published in the Fall of 2012. In this book the colourful Dr. Jin Fuey Moy, and his two brothers, will return.

        Jin Kee                  Jin Mun                Jin Fuey
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Toyota on a Chain: Creatively Challenged Art or Parody?

Last year’s Hong Kong International Art Fair at the Hong Kong Convention and Exhibition Centre included the “Toyota Chain”, by Thomas Hirschhorn, which, was exactly that. Mr Hirschhorn, a Swiss artist, made the piece in 2002, and so far, nobody wants to buy it.

To magnify an existent trademarked logo, without authorisation by the trademark holder, and put it on a chain seems quite stale as a piece of art. But is it legal? In Hong Kong there is no such thing as parody in the Trade Marks Ordinance (and not even in the Copyright Ordinance, so that excludes an analogous application, although it is being considered, see here). And even if there was, I think it is doubtful that this piece of cardboard, adhesive tape, aluminium and red spray falls within the scope of parody. Mr Hirschhorn uses the name recognition and reputation of the Japanese car brand to exploit commercially. In Hong Kong Mr Hirschhorn was definitely diluting Toyota’s trademarked logo and name and possibly in jurisdictions with a parody provision as well.

Hirschhorn’s “Toyota chain” at the 2011 Hong Kong International Art  Fair
Photo: Danny Friedmann

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Microsoft Applies Doctrine of Landlord Liability To Software Piracy

Peter Ollier has an interesting article for Managing Copyright about Microsoft’s alleged first landlord liability case to tackle rampant software piracy.

Microsoft is suing Beijing Chaoyang Buynow because two of retailers, Beijing Hongguang Century Trading and Beijing Zhuojue Elements Trading were selling computers with pre-installed counterfeit Microsoft Windows and  Office. 
The other case, whereby Microsoft is suing retailer Shanghai Gome at Shanghai Huangpu District People’s Court seems to be a traditional case (at least when Shanghai Gome is a subsidiary of Gome Electrical Appliances Holding Limited)
Read Mr Ollier’s article here.


Landlord liability in tort law 

Article 2 Tort Law 2010: Those who infringe upon civil rights and interests shall be subject to the tort liability according to this Law. “Civil rights and interests” used in this Law shall include the right to life, the right to health, the right to name, the right to reputation, the right to honor, right to self image, right of privacy, marital autonomy, guardianship, ownership, usufruct, security interest, copyright, patent right, exclusive right to use a trademark, right to discovery, equities, right of succession, and other personal and property rights and interests.


Article 9 Tort Law 2010: One who abets or assists another person in committing a tort shall be liable jointly and severally with the tortfeasor. One who abets or assists a person who does not have civil conduct capacity or only has limited civil conduct capacity in committing a tort shall assume the tort liability; the guardian of such a person without civil conduct capacity or with limited civil conduct capacity shall assume the relevant liability if failing to fulfill his guardian duties. 
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Sanrio Brand Licensor Says The Darndest Things, Or Maybe Not

TGIF

Peter Ollier wrote an article about how Disney and Sanrio are licensing some of their brands in China.

Licensable “cuteness” popular among Hong Kong population
Lanham Place, Mong Kok
Photo: Danny Friedmann

Roberto Lanzi, president of Sanrio Consumer Products for Europe, Middle East and Africa, was speaking at a panel called “Licensing and the flourishing region: Asia”, at a conference during the 10th annual Hong Kong International Licensing Show. Mr Lanzi said that he was the only speaker on the panel that did not hate counterfeits.

He claimed to feel relieved when he once saw fake Hello Kitty products being sold in Hong Kong’s Ladies Market:

When Hello Kitty disappears from there we might be dead.

However, the Ladies Market in Mongkok, has been removed by the USTR from the list of Special 301 Out-of-Cycle Review of Notorious Markets, on December 20, 2011, see here.
Maybe that is the reason why Mr Lanzi is president for Europe, Middle East and Africa, and not Asia.

UPDATE: In a reaction (still have to verify the identity of commenter) Roberto Lanzi wrote: “I never mentioned Lady’s market, I spoke about Temple Street and I was just jocking. Best regards Roberto

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Rethinking Intellectual Property Protection in Hong Kong

After the welcome remarks by professor Douglas Arner (head Department of Law, HKU) and the opening speech by Peter Cheung, (director IPD, HKSAR Government) see here, the first panel presentation of the Round Table event organised by Law & Technology Centre of HKU and IP Law Center at Drake University started, moderated by assistant professor Haochen Sun, of the Faculty of Law, HKU.

Assistent Professor HKU Haochen Sun is moderator
Photo: Danny Friedmann

Professor Alice Lee, Associate Dean, Faculty of Law HKU gave a presentation entitled: “Reflections on Intellectual Property Reform in Hong Kong

Professor Lee explained that the Hong Kong Copyright, Trade Marks and Registered Design Ordinances of 1997 did not change dramatically the substantive rights, in contrast to the patent reforms. Hong Kong amended its Patent Ordinance, June 27, 1997 and on February 22, 2008. The Patent Ordinance probably will be amended again after the government have considered all responses to its consultation paper (consultation period ended December 31, 2011). Given the limited time, Professor Lee focused on possible reform of small-term patents, instead of on possible reforms of standard patents, (read more about Hong Kong’s need for an Original Grant Patent in combination with reciprocity and Hong Kong’s potential as regional legal hub here), nor on whether there should be regulations for patent agents in Hong Kong.

Hong Kong is in need for a balanced approach for the short-term patent, which is relatively cheap and easy to get, since there is no substantive examination for a protection of 8 years. However, Professor Lee is concerned that the short-term patent might be prone to abuse. She illustrated this with the Octopus Card Limited v ODD.HK Limited case.

The conflict was about the validity of two short-term patents registered in the name of ODD.HK Limited. A judgment delivered on March 17, 2009, by Deputy High Judge Chen Jiangyao (陳江耀), whereby Madam Fung Wai Mun Polly was unrepresented, HCMP104/2007, ordered the revocation of the two patents with costs to the petitioner, because both patents lack novelty and creativeness (兩項發明都不是新穎和沒有創造性). Madam Fung Wai Mun Polly of ODD.HK Limited simply removed the chips from the Octopus Card (with which you can pay to use the MTR, buses, mini-buses and at many shops in Hong Kong) and put them in plush toys, and after she got the short-term patents sued Octopus Card Limited for patent infringement. Read the case here in Chinese.

Professor Alice Lee, HKU
Photo: Danny Friedmann

The Octopus Card case was mentioned in the April 19, 2010 Environmental Systems Product Holdings Inc. v DPC Technology Ltd., case HCMP1465/2008. And the Windsurfing test (Windsurfing International Inc. v Tabur Marine (Great Britain) Ltd [1985] RPC 59 (at 73) was mentioned to see whether the patent is obvious or not. In the same Environmental Systems Product Holding case, the counsel for the applicant, Mr Felix Pao, “described the short-term patent application systemunder Part XV of the PO as an “honour system” as it depends heavily on theintegrity and honesty of an applicant in that an applicant would not make anyapplication in respect of a claimed invention known to be not patentable forwhatever reasons.” The Recorder Rimsky Yuen, SC in Chambers, Court of First Instance, High Court, agreed. 

Professor Lee questioned who is going to pay for the abuse? Her question is very relevant. The strength of the short-term patent (not expensive and easily granted) might be its weakness as well. Therefore it might be considered to increase the fee to get a short-term patent, so that bad faith applicants will be deterred, or use a part of the fee to compensate the abused party in the legal costs.

Then moderator Haochen Sun introduced Mr Mayank Vaid, IP Director, Louis Vuitton, Hong Kong, as the IP director of the most popular luxury brand. Mr Vaid’s presentation was called “Corporate Decision Making in IPR Protection and Enforcement

Mr Vaid is responsible for protecting the intellectual property rights of LVMH Fashion Group, which includes iconic brands such as LV, Marc Jacobs, LOEWE, CELINE, KENZO, Emilio Pucci and Berluti. Therefore, the company has made the IP perspective part of its overall business strategy. Mr Vaid said that from a commercial sense IP is crucial to guarantee the customer experience. LV’s promise of exclusivity is per definition incompatible with counterfeit goods, that confuse customers and dilute the distinctiveness of the brand, and damage its reputation. Therefore Louis Vuitton takes full control over its production process (no production is done in Asia) and supply chain (no distribution to Hong Kong via the internet) to protect its brand value very seriously. Louis Vuitton has now around 80 stores in Asia, excluding China and Japan.

Mr Vaid explains that a transformation has taken place in the economy, from one that was based for 80 percent on the value of goods and services and for 20 percent on the value of the underlying intellectual property rights, to an economy where this ratio has been reversed.

Bernard Arnault, CEO of LVMH, and Yves Carcelle, CEO of Louis Vuitton stand in Louis Vuitton’s tradition of proactively and assertively protecting and enforcing the IP of its brands. This tradition dates from 1908 when LV fought its first IP battle. Louis Vuitton has a zero-tolerance policy against counterfeiters, (which IP Dragon thinks, deserves emulation). Why do not more companies protect and enforce their intellectual property rights as assertive as Louis Vuitton? According to Mr Vaid, some might take the view that marketing is more important, or some might be afraid to annoy the local government, or they have not reserved enough budget to enforce their intellectual property rights.

Mr Vaid summed up product categories in which Louis Vuitton is not active, but where people use the trademarked logo unauthorisedly: fake nails, rikshaws, tiles, a Romanian LV themed restaurant, bedsheets, iPhone caps, and condoms, see here. Especially in Korea one can find bags with similar monograms, such as LX, LJ etc, which leads to confusion and/or dilute the trademark, and Louis Vuitton is tirelessly filing lawsuits against those manufacturers, distributors and sellers.

It is getting increasingly more challenging for LV to protect and enforce its intellectual property rights, since the reaction time of the counterfeiters is getting faster. It takes LV about halve a year to launch a new product (from design, production and distribution to sales). Before, the counterfeiters needed to send someone to a fashion show in Paris or Milan, but now they only have to watch the fashion shows via Facebook and three months later one can find counterfeit designs in places such as Dubai. The challenge to fight counterfeiters is not just for companies such as Louis Vuitton, but for society in general: since counterfeiting has been linked to organized crime, child labour, degradation of the environment, violation of safety laws, money laundering, etc.

Louis Vuitton has not only a reputation thanks to its exclusive products, but also because of its proactive intellectual property protection and enforcement. It is well known that Louis Vuitton did not only trademark the name Louis Vuitton, and the monogram LV but also the Monogram Canvas, and each of its constituting parts: the fourpointed stars, four-pointed stars inset in curved diamonds (flower quatrefoil diamond), and four-pointed flowers inset (flower quatrefoil). These marks are enforced too, read here. Read Paul-Gerard Pasol’s Evolution of the Monogram Design here. In City Chain Stores (S) Pte, Ltd. vs Louis Vuitton Malletier, the Court of Appeal of Singapore overturned the trial court which enjoined City Chain Stores of using Louis Vuitton’s flower quatrefoil, and flower quatrefoil diamond designs, because it deemed that City Chain Stores used the designs in a random pattern and non-uniform way and therefore not in a origin-related use but for embellishment and decorative purposes. Although sections 27(1) and (2) of the Singapore Trade Marks Act (1998) are based on article 5 (1) a-b, EU Trade Marks Directive (Directive 89/104/EEC, December 21, 1988), the Court of Appeal chose to interpret the requirement of trademark use stricter than the European interpretation (which is to look whether the defendant’s use is liable to affect the functions of the trademark). Reason was that the answer by the European Court of Justice (Arsenal Football Club plc vs Matthew Reed) on whether non-origin-related use could constitute trademark infringement, was considered uncertain and controversial by UK professors Lionel Bently and Brad Sherman. Also, the Max Planck Study on the Overall Functioning of the European Trade Mark System of February 2011, stated that current European Court of Justice jurisprudence on the issue was “neither consistent nor satisfactory” (see paragraph 2.178 here). However, the anti-dilution provision of section 53 (3) (b) seems to be able to protect the communication, investment and advertising functions of a trademark. Read Ng-Loy Wee Loon’s article about it here.

Louis Vuitton is using some innovative ways to prevent counterfeiting and new protection and enforcement routes. These include pioneering landlord liability (read Joseph Simone’s article for WIPO Magazine here and Daniel Plane’s Law Journal of INTA article here), cooperating with Thai monks to raise the awareness that trademark infringement is a sin, and is looking whether the principles of Sharia law can be construed in a way to provide support for such a protection, see here.

Mr Mayank Vaid, IP Director, Louis Vuitton, Hong Kong
Photo: Danny Friedmann

Peter Cheung, director Intellectual Property Department HKSAR Government, asked Mr Vaid about the Chewy Vuiton case (Louis Vuitton Malletier S.A., Plaintiff, v. Haute Diggity Dog, LLC, Victoria D.N. Dauernheim, and Woofies, LLC, Defendants. 464 F.Supp. 2d 495, US District Court For The Eastern District Of Virginia, Alexandria Division, November 3, 2006, uploaded by Susan Scafidi of Counterfeit Chic here, and the appellate decision of Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 4th Cir. November 13, 2007, Ms Scafidi uploaded here).

The district court did not apply the statutory factors for dilution, and simply reasoned that because Haute Diggity Dog’s product was a parody it meant that “there can be no association with the famous mark as a matter of law.” The 4th Circuit recognises that a claim of parody does not preclude liability for dilution. But by checking the statutory factors for dilution the 4th Circuit came to the same solution. However, IP Dragon agrees with appellant Louis Vuitton Malletier and the Amicus International Trademark Association (INTA). To use a name such as Chewy Vuiton in combination with the monogram of the letters C and V constitutes dilution by blurring. Dogs chewing on products that are purposively been associated with Louis Vuitton brand, can be seen as tarnishing to a luxury brand. The same can be said if a vulgar snack bar is purposively associating itself in the mind of the public with a 5 start hotel chain via a similar sign as the mark. The similarity between the sign and the mark is not controversial to both courts: “similarity is an essential part of a parody, as the similar marks and trade dress must “convey two simultaneous-and contradictory-messages: that it is the original, but also that it is not the original and is instead a parody.”” The 4th Circuit stated: “The satire is unmistakable. The dog toy is a comment on the rich and famous, on the Louis Vuitton name and related marks, and on conspicuous consumption in general.” This statement is subjective. Even if it really is parody, it can be argued that Haute Diggity Dog rides on the coat tail of a famous brand and misappropriates Louis Vuitton’s substantial investments in labour, skill, effort and capital.
Hong Kong does not have a parody exception in its Trade Marks Ordinance. If they would have such a provision, it would be in Chapter 559, Section 19 ‘Exceptions to infringements’, see here.

Louis Vuitton filed a lawsuit for trademark dilution, false designation of origin and unfair competition against Warner Brothers over the use of a fake LV bag in the movie The Hangover 2, and wants that all DVDs will be pulled. Watchful Louis Vuitton employees found out that the bag used in the movie was made by Diophy, a company that Louis Vuitton is suing, see here.

Over the years Louis Vuitton has organized art exhibitions and supported many artists as a kind of modern maecenas. Mr Vaid is clear about when Louis Vuitton will file lawsuits: when one of its trademarks is used for commercial exploitation. The trademarked logo LV has been abused by a Belgian “artist” in a not so kosher nor halal way: he tattooed pigs with the LV trademark without the permission of Louis Vuitton, and then killed them and sold their skins. Besides the blatant trademark infringement, the lack of animal welfare caused a controversy. The tattooed pigs were banned from the Shanghai Art Fair in 2008, see here.

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“Rethinking IP” Round Table HKU – Drake University

Knowles Building, at HKU
Photo: Danny Friedmann

Last Saturday morning, lawyers, academics and students from Hong Kong, Macau, Singapore, Australia, Japan and the U.S., all passionate about intellectual property rights, gathered at the University of Hong Kong for a round table discussion on intellectual property and policy. It was organised by the Law & Technology Centre of the University of Hong Kong (HKU) and the Intellectual Property Law Center at Drake University Law School located in Des Moines, Iowa. The 10th floor of the Knowles building with its great wooden concentric structure accommodated the participants for this purpose.

The programme consisted of four panel presentations (will be separate blog postings) that urge us to rethink:
Panel I: IP Protection in Hong kong;
Panel II: IP Protection in the Digital Age;
Panel III: IP Protection in Mainland China;
Panel IV: IP Protection globally.

After the opening remarks by professor Douglas Arner, head of the Department of Law of HKU, who welcomed everybody and told that Law & Technology Centre of HKU has already existed for a decade.

Professor Douglas Arner, head of Department of Law, HKU
Photo: Danny Friedmann
The opening speech was given by Peter Cheung, director of the Intellectual Property Department (IPD) of the HKSAR government. 
Left professor Peter K. Yu, Drake University and the right Peter Cheung, director IPD, HKSAR Government
Photo: Danny Friedmann
Trading Intellectual Property in Hong Kong”   

Mr Cheung recalled that he was invited by the Motion Picture Association of America (MPAA) to come to Hollywood. There, he familiarised himself with the Three-Act Structure, which is a success formula to make a blockbuster movie. But, as Mr Cheung explained, it can be applied to reach his goal, namely to use IP trade to drive stakeholders’ economic development. In Act I the context is given, Act II the challenge, and Act III the resolution. I am sure that the Hong Kong movie scene uses a similar scheme to keep the audiences captivated. Those Chinese from the Mainland, versed in Marxism, might recall the different acts as Hegel’s thesis, anti-thesis, synthesis, respectively. So if Act I is the setting whereby Hong Kong is introduced as a Special Administrative Region with the ambition to become a regional knowledge hub, Act II is the challenge of how to get there? In other words, how to apply IP, how to monetise these intangible assets? Mr Cheung was inspired by a Japanese car manufacturer who was not interested in cars, but in the money that you can make with cars. This same approach should be followed with IP. (IP Dragon wonders whether it is really possible to exploit IP, without really loving it?). MBAs teach you many interesting things but not about the role of intangibles, Mr Cheung said. Therefore, we need to map out our niche, and make an inventory of what is already available, predict change, seize opportunity and collaborate to innovate, and execute these processes in parallel. Because, we live in an IP economy, Mr Cheung told. The significance becomes clear when one looks at the most valuable brand in the world: Coca-Cola (71,861 million U.S. dollar, according to Interbrand in October 2011). If all tangibles are destroyed, Coca-Cola could resurrect itself because of the worth of its intangibles. IP can be lucrative, even though it is sometimes tiny. For example Mr Cheung knows the composer of the two second jingles.
If one accepts that one person in a million goes to the best university and has the change to become really  innovative, then Mainland China wins (with 1,340 people), Europe will be in second place (833 person ) and the US (312 person) third place. Hong Kong gets only 8 of these talented people. Hong Kong should become a platform where demand and supply come together. According to Mr Cheung Hong Kong can bring together IP owners that want to sell some of their IP, via IP intermediaries (for this Hong Kong needs officials, professionals, scientists and financiers) so that investors can buy IP. Now only goods and services are traded. There should be transformation to IP.
Hong Kong can have a first-mover advantage in IP trade. Hong Kong has a rule of law, attractive tax system, with a bilingual work force, and is not a gate-to-China, but is part of China. Hong Kong has to take the initiative and make it blaze its own trail. Shenzhen already has a trade platform, but just a website and they seem not very active, they do not have an international nor a holistic approach to the trade platform. China each province has its own platform. In Hong Kong there are more professionals.
The HKSAR government seems to have a lot of attention to niches such as Islamic banking. In the audience there was some concern about whether Mr Cheung is getting enough support from the government. Mr Cheung is well positioned to convince the HKSAR government for his case.

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Key IP Question Before Considering Joint-Venture: Am I Educating My Future Competitor Or Building A Long-Term Partnership?

Colin Davies, managing director of Accenture Software, wrote a column for China Daily European Weekly (always asking whether the content is not usable for the Chinese edition) about ways that will make a better cooperation between Chinese and Western software companies possible: “The West will need greater assurances that the regulatory environment is friendly and conducive to building strong business relationships in ways that both sides can view as credible and mutually beneficial.” Who can disagree with this.

Mr Davies also tries to answer the question of how a Western software developer can give a client in China a jump-start asset and let them customize it, while at the same time protecting their intellectual property?

Although Chinese laws do exist to protect intellectual property (IP), the question is whether anyone is prepared to enforce them. IP protection will need to be adequately addressed before Western software developers are prepared to dive aggressively into the Chinese market.

Then he sketches the situation of a Sino-Western joint-venture, in a bit too optimistic light, in my view:

Meanwhile, the prospect of a joint venture is attractive because Western companies, rather than investing resources to establish a foothold in a new and very different environment, have the advantage of leveraging the know-how of a local organization already well entrenched in China. This affords them the immediate benefit of a partner that has trust and recognition in the marketplace, knows the local players, and is more likely to defend the IP fiercely for the simple reason that it is also part of theirs.

When simple might be more complex
Some Western companies have been lured (or pushed) a bit too easily in “sharing” their intellectual property without rock-hard agreements that guarantee that the Western company is getting the intellectual property back once the joint venture dissolves. In other words, your joint venture partner can be a significant intellectual property challenge too. Also each company has to think carefully about how much of its knowledge it is willing to transfer in order to get market access. To sum up: Each potential Western company has to ask itself this question: Am I educating a future competitor or building a long-term partnership? Although Mr Davies is not asking the question, he is answering them: “Trust is vital.” Read his article here.

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China’s NCA: Authorized Copyrighted Works on Video Sharing Sites Average 76 Percent

China’s National Copyright Administration (NCA) recently announced that on average, only 76 percent of the movies and TV series on the country’s 18 major video-sharingwebsites are authorized copyrighted works“,  wrote Lu Yanxia of Beijing Daily, edited and translated by Yao Chun of People’s Daily Online here.

The top 5 most popular video sites in China are, according to Alexa
1. Youku

Video sharing sites Xunlei, VeryCD, and Baidu video have not submitted the list of copyrighted movies and tv series they share to NCA. So the percentage might go up or down.

I think this percentage is too low. This problem is not limited to China. I think the enforcement system for online copyrighted works is in need for a systemic overhaul. I will publish a paper on the subject soon. 
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Fast Moving Counterfeit Goods From China Found in India

For a long time FMCG was the abbreviation for Fast Moving Consumer Goods, also in India. But you might take the C to mean counterfeit, because an increasing amount of counterfeit healthcare, skin cremes, shampoos, toothpaste and cigarettes of famous Indian companies such as ITC (India’s second biggest FMCG) and Dabur (India’s fourth biggest FMCG) and are sold in India and some African countries. India’s mottoTruth Alone Triumphs” hopefully provides solace.

Read The Economic Times article about fake Indian products made in China here.

There is something fundamentally wrong
when the label Made in India is
Made in China.
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