Toyota
Lost a Lawsuit Against a Chinese Car Manufacturer
The
high profile lawsuit, in which TOYOTA Motor Corporation, the No. 1 Japanese
automobile manufacturer, sued China Geely Group, a Chinese automobile
manufacturer based in Zhejing Province, for trademark infringement and
unfair competition, reached a judgment for first instance after hearing
that lasted nearly an entire day held in August.
In
January 2, 2003, Toyota instituted a lawsuit in the court against Geely
and two car dealers in Beijing for trademark infringement and unfair
competition. Toyota alleged that the logo of Geely's Merry modal car
was confusingly similar to the logo of Toyota, for which Toyota obtained
trademark registration in China in 1990. In addition, Geely unlawfully
used the word marks " "
and "TOYOTA", for which Toyota obtained trademark registrations in China
in 1989 and 1980, respectively, in the parts of its Merry modal car.
Toyota also alleged that the use of the slogans by the defendants as
advertisement for the promotion of Geely's Merry modal car such as "Merry
Car, Toyota Power", "Toyota 8A engine is used" and "Technical parameter:
Toyota 8A" misled the consumers and therefore constituted trademark
infringement and unfair competition.
In addition to the claims of an injunctive relief, damages of 14 million
Yuan (US $1.7 million) and compensation of 150,000 Yuan (US $18,000)
for stopping the infringement, Toyota requests the Court to recognize
its registered word marks ""
and "TOYOTA" and its logo as well-known trademarks under the new regulation
regarding the recognition and protection of well-known trademarks.
In the decision issued by the Beijing No. 2 Intermediate People's Court
on November 24, 2003, the Court rejected all of Toyota's claims.
The Court holds that the accused logo of Geely did not infringe Toyota's
trademark right based on the reason that the logo of Geely is obviously
different from that of Toyota, and thus cannot cause any confusion among
the relevant public, including car purchasers or users, and car service
providers. The Court is of the opinion that when a consumer purchases
a car, he will pay higher attention to the brand, performance, price
and manufacturer of the car since it is an expensive commodity. Before
making a decision to buy a car, the consumers would compare different
modals carefully and thoroughly. In addition, Toyota's logo is highly
distinguishable and enjoys high fame due to Toyota's long-term usage
and continued marketing campaigns. As a result, it is rather difficult
to cause confusion among the relevant public.
The Court fund that the engine used in the car was 8A modal engine,
which was provided by a joint venture of Toyota in Tianjin, China. The
technology of manufacturing the engine was licensed from Toyota.
The Court holds that the use of the words ""
and "TOYOTA" in the publicity materials of Geely is to introduce the
modal and resource of the engine of the car to the consumers, which
is in conformity with the commercial customs. The words are not used
as trademarks and therefore, it cause no damage to the trademark right
of the plaintiff. Although the use is more or less exaggerate, it does
not constitute a misrepresentation as to the performance, usage of the
product with intention of misleading the consumers. The relevant public
could not consider the engine was made in Japan. And as the technology
of manufacturing the engine was licensed from Toyota, it will not damage
the goodwill of plaintiff's brand.
The Court concluded that the use of the logo of Merry modal car, and
use of the words "" and
"TOYOTA" in the parts of the car and the advertisement materials of
Geely and other defendants can not cause any confusion as to the manufacturer
of Geely's Merry modal car, nor any association of the cars manufactured
by Geely and Toyota.
As to the Toyota's request to recognize its registered word marks ""
and "TOYOTA" and its logo as well-known trademarks, the Court holds
that in this case, it is not necessary to recognize if the marks are
well known or not, since the goods of the defendant is the same as of
the goods designated for the marks of the plaintiff. According to the
trademark law, a special protection shall be given to a well-known trademark.
A trademark shall not be used if the trademark is identical with or
similar to a well-known trademark of another person already registered
in China and is likely to mislead the public and damage the interests
of the owner of the registered well-known trademark, in respect of goods
which are not identical with or similar to the goods to which the well-known
trademark applies. The Court is of the opinion that when judging if
a mark is similar to a registered mark, and if a mark used on the goods
which are identical with or similar to the goods designated for the
registered mark mislead the relevant public, recognition of the registered
mark is a well-known trademark is not a per-condition.
Toyota has lodged an appeal to the Beijing High People's Court against
the decision.
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