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Adam L. Brookman
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Don’t Let Someone Else Own Your Trademark in China
China has a "first to file" trademark system. This means that in China, unlike the United States, your use of a trademark does not give you any trademark rights. Instead, the first person who files to register a trademark can obtain the right to use that mark in China to the exclusion of the legitimate user of the trademark! While it is possible to challenge an application or registration that was acquired in bad faith or claims rights in a well known mark, such challenges are expensive and the outcomes not certain. Consider the following two scenarios.
Scenario 1
You have goods manufactured in China by a first supplier. You find a better supplier and move all your business to that supplier. The first supplier, seeking to obtain leverage (or revenge), unbeknownst to you, files and obtains a trademark registration on your mark that you place on all your goods before they are exported. The first supplier then goes to court and obtains an injunction against your current supplier stopping the export of all your goods. Because you have no time to challenge the trademark registration, you are forced to negotiate with your ex-supplier to get your goods released or try to find a way to remove your mark from the goods.
Scenario 2
You open negotiations with a Chinese company to manufacture your product for export and sale into the domestic Chinese market. The negotiations fall through. Unbeknownst to you, the Chinese company files for and obtains a trademark registration on your mark. You finally complete a deal with another Chinese company and then discover that goods bearing your mark are being sold in China and exported out of the country. You are forced to either negotiate with the first company, forego your plans in China until you are able to challenge their registration on the grounds of bad faith or pick another name to use on your product.
The above two scenarios are not farfetched. They occur with startling regularity. However, these situations can be easily avoided by filing for trademark registrations in China before you even begin negotiating an arrangement in China. Such filings are not overly expensive and can be done by filing direct national applications or by exploiting international treaties that leverage pre-existing U.S. applications or registrations. Boyle Fredrickson has extensive experience in protecting trademarks in China and can assist you in pursuing Chinese registrations for your marks.
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Patents: The Great Wall of China
Andrew S. McConnel |
Patent protection in China can be obtained under the familiar invention patent system or what is known as a utility model system. Invention patent applications are subject to a full examination and have a term of 20 years from filing while utility model applications receive limited examination and have a term of 10 years from filing. China is a member of both the Paris Convention and the Patent Cooperation Treaty (PCT), meaning that a Chinese patent application can be filed directly from a corresponding US application within the allotted 12 month period, or from a PCT application at the time of national phase entry. Since China is what is called an “absolute novelty” country, a patent application must be filed somewhere (such as in the US) before publication, public use or disclosure of an invention anywhere in the world.
You should consider filing for patent protection in China if: 1) you see significant market potential for your product in China; 2) your product is being produced by a Chinese vendor – especially if the vendor is using your tooling; or 3) there is a likelihood that competition for your product will come from Chinese companies or others who will use Chinese companies for production.
Historically, patent enforcement in China has been problematic and biased. However, there have been signals in recent years that China will more vigorously and equitably enforce patent rights. At the very least, obtaining patent protection in China can be valuable in preserving a company’s right to stop or at least threaten an infringer at the source.
Boyle Fredrickson has extensive experience in obtaining, maintaining and enforcing patents in China, and can provide guidance and assistance that will help you make intelligent, effective use of the Chinese patent system.
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Adam L. Brookman
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www.scam.cn
You receive an email message from a kindly Chinese domain name registrar who warns you that a company has applied to register your name (or trademark) with various Asian suffixes (e.g., .cn, .tw, .asia). The email is in broken English giving it instant credibility:
Dear CEO,
We are the domain name registration organization in Asia, which mainly deal with international company's in Asia. We have something important need to confirm with your company.
On September 18, 2010, we received an application formally, one company named "Longhua International Holdings Ltd" wanted to applied for the domain names boylefredrickson.asia, boylefredrickson.cc, boylefredrickson.cn, and boylefredrickson.tw.
During our preliminary investigation, we found that these domain names' keyword and internet trademark is identical with your trademark. I wonder whether you consigned Longhua International Holdings Ltd to register these domain names through us or not? Or is Longhua International Holdings Ltd your business partner or distributor in Asia? Currently, we have postponed this application of this company temporarily already. In order to deal with this issue better, please let the principal make a confirmation with me by telephone or email ASAP
Best regards,
Nicholas Chen
IT Director
Before you pick up the phone to call China or start typing a reply, there is one thing you need to know. This is a scam! There is no Longhua International that is trying to register your domain name in China. And there is no benevolent Chinese registrar who is looking out for your interests. There is, however, a Chinese registrar who would be happy to charge you a vast sum of money for a domain or three you probably don’t need and could get for far less. If you do want to own these domain names for your own use or to prevent someone else from getting them, you can easily register them yourself or ask Boyle Fredrickson for assistance. Most of these domain names are available at reasonable prices through the larger registrars such as GoDaddy. com and Register.com. There is no need to spend the exorbitant fees that this not so benevolent registrar will charge you to obtain these domain names.
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Chinese Design Protection: The Inexpensive Sword and Shield
Michael J. Gratz |
Unique designs are protectable in most industrialized areas of the world including China. Such design protection may be good enough to stop most competitors, if your world-wide strategy is well thought out. For example, a design patent in the US can prevent the importation of “Chinese copies”. Design applications are also often easier to file, more affordable, and easier to get allowed. An additional benefit is that designs are easier for judges and customs officials to review and interpret.
Several clients of our firm have had great success in enforcing their design rights in China, including the consumer products giant, S. C. Johnson & Son of Racine. For consumer products, as in the US, design patents usually move through the Chinese Patent Office in less than twelve months. Typical costs to prepare and file such applications are usually less than $3000. However, the biggest challenge with any design case is the drawings. The drawings must show the unique features of the design. In addition to consumer products, design patents may also be valuable protection for jewelry, automobile parts, and furniture designs.
With regard to Chinese design application filings, our experiences with other clients there have also been very positive. Because design protection is “all about the drawings”, there are usually also cost savings because no significant translations are needed as in utility patent applications. Further, in China, design cases are subject to less rigorous examination and, therefore, they move through the Chinese examination office much more quickly than the typical utility patent application. This generally leads to significant “prosecution” cost savings as well as quicker enforcement opportunities.
Design protection has many benefits, but it is not appropriate in all cases; specifically if the valuable features of a particular product are not driven by the product’s appearance, but rather by its function. If you are interested in pursuing design protection in the US, or in China, please contact Boyle Fredrickson for more information.
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