Recently, Beijing IP Court made a final judgment in the trademark infringement lawsuit filed by an individual surnamed Ma against Shenzhen Chow Tai Fook Online Media Co., Ltd. (“CTF Online Media"). Beijing IP Court dismissed Ma’s appeal and upheld the judgment of the first instance. The judgments of the first and second instances both supported CTF Online Media’s defense of non-infringement by prior use and further concluded that Ma’s acquisition of the trademark right could hardly be justified and his filing of this lawsuit constituted an abuse of rights. Zhong Lun represented CTF Online Media in this case’s first and second instances. The legal team was led by partners Jimmy Huang and Hope Yang, and other team members included associate Brenda Jin, among others.

Chow Tai Fook Jewellery Group (“CTF Group") is a well-known jewellery conglomerate that established the brand of “骄人" in 2005 and has since been producing, promoting and distributing products under the brand in China. In 2017, CTF Group established a subsidiary, CTF Online Media.

In July 2020, Ma filed a lawsuit with Beijing Xicheng District People’s Court (“Xicheng Court") based on the trademark “" he had applied for in 2008 and registered in 2010 on gems and similar goods. Ma claimed that CTF Online Media’s distribution of “骄人" products on e-commerce platforms had infringed his exclusive right to use his registered trademark, on which ground he required CTF Online Media to stop the infringement and pay compensation to him.

As the legal counsel for CTF Online Media, Zhong Lun lawyers comprehensively analyzed the case, formulated a response strategy mainly focusing on the defense of non-infringement by prior use and advised CTF Online Media to collect evidence about the scope covered by its sales and promotion of “骄人" products prior to Ma’s application, CTF Online Media’s relationship with CTF Group and Ma’s bad faith. At the same time, we fully demonstrated that Ma’s registration of trademark was a preemptive registration of CTF Group’s “骄人" brand, and Ma had abused his rights by filing this lawsuit.

Xicheng Court supported our defense of non-infringement by prior use, holding that CTF Online Media’s activities in dispute did not constitute infringement and thus dismissing all the claims of Ma. Xicheng Court further held that Ma’s obtaining of his trademark could hardly be justified, and his exercise of trademark right had violated the principle of honesty and credibility and constituted an abuse of rights. Ma was dissatisfied with the first instance judgment and filed an appeal. Beijing IP Court upheld the first instance judgment after hearing the case.

One of the highlights of this case is that, though CTF Group only sold “骄人" products in physical stores before Ma applied for his trademark and CTF Online Media was established long after Ma had registered the mark, Zhong Lun lawyers successfully established a prior use defense for the client’s distribution of “骄人" products on the internet. In this case, Zhong Lun lawyers accurately grasped the legislative purpose of the prior use defense, fully researched relevant typical cases and thereby successfully safeguarded the client’s legitimate rights. The courts’ reasoning on the application of prior use defense is also of high reference value for other similar cases in the future.

Another highlight of this case is that the courts also fully and clearly identified Ma’s subjective malice, holding that his obtaining of the trademark concerned was unjustifiable, he exhibited trademark hoarding behavior, and his filing of this lawsuit constitutes an abuse of rights. This judgment can resonate with other related cases and lays a solid foundation for CTF Group’s intellectual property protection. It also fully embodies the purpose of intellectual property trials to resolve disputes fundamentally and achieve positive social effects. At the same time, this case sounds the alarm to other entities who have squatted, hoarded trademarks, abused their rights and wasted judicial resources or harbor an intention to do so, and once again demonstrates the courts’ firm stance on protecting intellectual property rights and maintaining a legitimate market environment.