Class 46 readers may recall that the subject of bad faith applications in China has been much discussed recently, including at a workshop at last year’s MARQUES Annual Conference. In this context, Ling Zhao and Tingxi Huo of the China Team discuss the latest announcement from the Supreme People’s Court regarding the JORDAN case.
On 24 December 2019, the Supreme People’s Court (SPC) of China announced Guiding Case No 113 for the courts at different levels to follow. The case was retried by the SPC on 7 December 2016 and it overruled the decision of the Trademark Review and Adjudication Board (TRAB) and the two lower courts’ judgments in the dispute over the trade mark 乔丹 (Qiaodan, JORDAN in Chinese characters) number 6020569 in class 28 (pictured above right), and made a retrial judgment in favour of Michael Jordan.
The trade mark was registered by a local company Qiaodan Sports Co, Ltd (Qiaodan Sports). Qiaodan Sports’ registration was finally considered by the SPC to be in violation of Article 31 of the Chinese Trademark Law (2001), as the registration infringes the prior name right of Michael Jordan. The SPC's announcement of the retrial judgment is very significant in that it sets binding legal criteria on the protection of prior name rights against bad faith registrations.
Administrative decision and two judgments
|The CNIPA and TRAB|
Today, the appeal examination organ is a division of the new superior organ China National IP Administration (CNIPA), whose review or appeal decisions can be appealed to the Beijing IP Court and the Beijing High People’s Court.
At the time of this case being examined, the Trademark Review & Adjudication Board (TRAB) was the administrative organ to examine the case and TRAB”s decision could be appealed to the Beijing No 1 Intermediate Court in the first instance and the Beijing High People’s Court in the second instance.
In the initial administrative dispute over the trade mark between Michael Jordan and Qiaodan Sports, Michael Jordan claimed that Qiaodan Sports’ registration of his name as a trade mark without his authorisation harmed his lawful rights and constituted a violation of Article 31. The TRAB ruled that there is certain difference between the trade mark and Michael Jordan’s full Chinese name “迈克尔·乔丹”, and that the term “Jordan” is a common English surname. It is difficult to determine the definite correspondence between this common surname and the star Michael Jordan. Therefore, the TRAB decided to maintain the disputed trade mark in favour of Qiaodan Sports.
Michael Jordan was dissatisfied and pursued the case by initiating legal proceedings before Beijing No 1 Intermediate People’s Court. On 1 April 2015, the Intermediate Court gave Judgment No (2014) Yi Zhong Xing (Zhi) Chu Zi 9163, upholding the TRAB’s decision. Michael Jordan appealed further to the Beijing High People’s Court, which made its Judgment No (2015) Gao Xing (Zhi) Zhong Zi 1915 on 17 August 2015, again upholding the TRAB's decision and Intermediate Courts judgment.
Michael Jordan then requested a retrial before the SPC. After examination, the SPC made a retrial Judgment No (2016) Zui Gao Fa Xing Zai 27, overruling the TRAB’s decision and the two lower courts' judgments.
SPC's findings and reasoning
1 Legal basis for protecting the personal name right
According to the SPC, the focus of the dispute in this case is whether the registration of the disputed trade mark infringes the name right claimed by Michael Jordan and violates Article 31, which stipulates that “the application for trade mark registration shall not infringe others' existing prior rights”. The General Principles of Civil Law, the Tort Liability Law and other laws also support the protection of the personal name right and provide compliance with the principles of honesty and creditability.
Where the registration of a trade mark damages the prior name right of another person, it shall be deemed a violation of Article 31. The protection of the prior name right shall be extended to not only the dignity of the natural person, but also the economic interests contained in the name, particularly the name of a famous person. If the registration of a trade mark composed of a name is likely to cause the relevant public to mistakenly believe that the goods or services marked with the trade mark have a specific connection with the natural person, such as the natural person’s endorsement, permission, etc, the registration shall be deemed to be detrimental to the prior name right, in violation of Article 31.
2 Preconditions for protection of the name right
When a natural person claims the protection of the name right, three conditions must be met: (1) The specific name shall have a certain popularity and be known to the relevant public; (2) the relevant public uses the specific name to refer to the natural person; and (3) the specific name should have a stable correspondence to the natural person.
Jordan is a common English name, but the evidence in this case is enough to prove that “Jordan” has a high popularity in China and is known by the relevant Chinese public. Given the high reputation of Michael Jordan as an NBA basketball star, when the name Jordan is used on sports products, people would tend to associate it with Michael Jordan rather than just the common name Jordan.
Moreover, the Chinese characters 乔丹 (Qiaodan) are the usual transliteration of the English name Jordan. Under such circumstances, in the mind of the relevant public in China, the name carries stable correspondence to Michael Jordan, who shall enjoy the name right.
3 Whether the use of the Chinese name “乔丹” (Qiaodan) by Michael Jordan or any interested party is necessary to claim protection
According to the Civil Law, “use” is one right enjoyed by the name right holder, not an obligation he shall undertake, not to mention the legal precondition for him to “forbid others to interfere, misappropriate or counterfeit”.
When Article 31 is applied to protecting the prior name right of others, the main issues are whether the registration of the disputed trade mark damages the name right of the natural person and whether the relevant public mistakenly believes that the goods or services marked with the disputed trade mark are associated with the natural person. It is not relevant whether the name right holder has actively used his name.
In this case, the relevant public and news media in China generally use “乔丹” (Qiaodan) to refer to Michael Jordan, while he and Nike Company mainly use “迈克尔·乔丹” (the transliteration of Michael Jordan). However, both Michael Jordan’s full Chinese name “迈克尔·乔丹” and surname “乔丹” have high notoriety among the relevant public, and are generally used by the relevant public to refer to Michael Jordan.
4 Whether the bad faith of the disputed party is relevant
The SPC concluded from the evidence that Qiaodan Sports had not sought Michael Jordan’s permission or authorisation to register or use his name, but directly registered a large number of trade marks closely related to Michael Jordan, including the disputed trade mark on sports goods, profiting from Michael Jordan’s high reputation and misleading the relevant public to associate the goods marked with the disputed trade mark with Michael Jordan. Although Qiaodan Sports used the trade mark for many years, spent much money on the publicity and won many awards, the SPC ruled that the efforts cannot wash clean the initial bad faith or justify the improper registration of the disputed trade mark.
Judicial determination to curb bad faith
As the case was first filed by Michael Jordan on 31 October 2012 when the Trademark Law (2001) was in force, the case was examined according to the old Trademark Law (2001). The same Article 31 has been amended as Article 32 of the Trademark Law (2013 and 2019).
In 2019, China revised its Trademark Law for the fourth time and the China National IP Administration (CNIPA) announced the corresponding new rules to implement the new Law, aiming to curb bad faith filings and registration. The SPC needs to declare China’s judicial attitude as well, and accordingly, it selected and announced this typical retrial judgment of 2016, setting it as a guiding case, clearly to reiterate China’s determination to curb bad faith from the supreme judicial angle. This guidance will be binding on all courts, with the SPC itself included, which will more effectively corner bad faith filing and registration.
In China, it is not necessary to challenge a pirated trade mark only on the basis of a prior trade mark right. If a party’s other type(s) of prior legitimate rights are preemptively registered by another party, it is possible to challenge the piracy on the basis of the former party’s non-trade mark rights, including but not limited to personal name right, personal portrait right, corporate name right, industrial design right, copyright, and domain name right.
Last but not the least, although it is possible to successfully challenge bad-faith registration in China, an earlier application or registration remains far more cost-efficient than a late challenge in this first-to-file jurisdiction.