Mengchun’s Comments
Infringers are becoming more sophisticated. This case illustrates how selling self-branded goods alongside well-known branded products under the same online listing can constitute trademark infringement. The court also found other “free-riding” tactics to be unfair competition. The judgment provides useful guidance for enforcing brand rights and addressing covert infringement.
Key Issue
Does selling self-branded goods alongside well-known branded goods under the same product link constitute trademark infringement?
Analysis
Trademark nominative use allows a business to use another party’s registered trademark to identify that party’s goods or services, or to indicate relationships between products. Such use must be in good faith, reasonable in scope, and must not harm the trademark owner’s rights. Improper use that misleads consumers or exploits a well-known mark’s reputation crosses the boundary of fair use.
When a seller knowingly uses a well-known trademark in prominent positions (titles, images, links) while simultaneously offering self-branded goods under the same link, this can confuse consumers and constitute infringement.
Case Overview
- Trademark Owner: By-Health Co., Ltd. (“By-Health”) – owner of the well-known “By-Health” mark.
- Defendants: Qian’en Pharmaceutical Technology Co., Ltd. (“Qian’en”) and Shangdong Computer Technology Co., Ltd. (“Shangdong”) – sold health supplements online, including “Qian’en Health” products.
- Conduct: Defendants purchased genuine By-Health products and listed them for sale alongside their own products on platforms such as Meituan, JD.com, Pinduoduo, and Tmall. The listings prominently displayed the “By-Health” mark, including in titles and images, while allowing consumers to select the defendants’ own products under the same links.
Court Findings
- The use of the “By-Health” mark in titles, images, and detail pages was trademark use.
- The defendants’ mixed-sale practice went beyond reasonable nominative use and exploited By-Health’s reputation for commercial gain.
- Given the significant brand recognition of By-Health, the defendants should have exercised caution and differentiated their own products. Their failure to do so showed clear intent to leverage the mark’s goodwill.
- Consumers were likely to confuse the origin of the products, believing that the defendants’ offerings were authorized or affiliated with By-Health.
Decision
The Guangzhou Huangpu Court held that the defendants’ conduct:
- Infringed By-Health’s registered trademark rights.
- Constituted unfair competition.
The defendants were ordered to cease infringement and unfair competition and jointly pay RMB 300,000 in damages. The ruling was upheld on appeal by the Guangzhou IP Court.
Takeaway
Rights holders should be vigilant against covert infringement practices, such as mixed-sale listings. Even when infringers sell genuine products alongside their own, the use of a well-known mark in prominent positions can constitute trademark infringement and unfair competition. Monitoring online platforms and enforcing rights proactively is critical to protecting brand value and preventing consumer confusion.
Court:
Guangzhou Huangpu District People’s Court
Final Decision Date:
March 14, 2025
Case No.:
(2024)粤0112民初2088号
(2024) Yue 0112 Min Chu No. 2088
