Perspective | Qualifying Infringement in Trademark Rights Disputes

In trademark civil dispute cases, the collegiate panel typically identifies the key issues centered around whether the defendant has indeed committed trademark infringement. If infringement is established, the panel then focuses on how the defendant should bear civil liability. The panel’s summary of these focal points closely aligns with the case’s core facts, which primarily include the determination of infringing acts and the calculation of damages. Parties involved present evidence, cross-examine each other, and engage in debate primarily around these two central factual matters. As for the determination of whether an infringement has occurred—a critical factual issue—the process follows a two-step approach: First, the panel assesses whether the defendant’s use of the allegedly infringing mark constitutes "trademark-like" usage. Second, assuming the mark in question qualifies as trademark-like usage, the panel proceeds to compare it directly with the plaintiff’s registered trademark, ultimately deciding whether the defendant’s actions meet the criteria for trademark infringement as outlined in Article 57 of the Trademark Law. Regarding the determination of damages, this can be further divided into two categories: statutory damages and punitive damages. Statutory damages are determined at the discretion of the collegiate panel, taking into account factors such as the distinctiveness and reputation of the plaintiff’s trademark, as well as the duration, scale, and scope of the defendant’s infringing activities. In contrast, punitive damages require a separate evaluation to establish whether the infringement was intentional, whether the circumstances were particularly serious, and to determine the appropriate base amount for calculating punitive damages. This article will focus solely on the "factual determination of infringement." Subsequently, the author will elaborate on the two-step methodology used to assess trademark infringement.

The prerequisite for determining trademark infringement is first to assess whether the disputed mark constitutes "use as a trademark." According to Article 48 of China's Trademark Law: "Use of a trademark as referred to in this Law means applying the trademark to goods, product packaging or containers, as well as commercial transaction documents; or using it in advertising, exhibitions, and other business activities—essentially, any act aimed at identifying the source of goods." In practice, when courts determine whether a disputed mark qualifies as trademark use, they typically rely on whether the mark is prominently displayed on the accused goods and their packaging. In other words, the key criterion is whether the mark can be distinctly recognized by the relevant public. As long as the mark exhibits even a minimal level of distinctiveness—enough for consumers to identify it—it is deemed to serve the function of distinguishing goods and thus qualifies as trademark use.

The author believes that Article 7 of the "Guidance on Trademark Infringement Judgment" (Guozhifa Baozi [2020] No. 23) states: "When determining whether a mark is being used, one should comprehensively consider factors such as the user's subjective intent, mode of use, promotional methods, industry practices, and consumer perception." While this approach to judgment is reasonable, it still carries significant subjectivity. To assess whether the disputed mark constitutes trademark-like use, we must examine the specific manner in which the alleged infringing act was carried out, while also evaluating both the defendant's subjective intentions and the objective effects of their actions. Specifically, we should carefully analyze the independence and distinctiveness of the disputed mark within its context, investigate whether the defendant has applied for trademark registration of the mark or similar identifiers, determine whether the defendant harbors an intentional desire to use the mark as a means of identifying the source of goods, ascertain whether the defendant directly refers to the accused products by the disputed mark itself, and assess whether the defendant employs the mark to distinguish among its own product lines. Additionally, we must consider how the relevant public perceives the disputed mark—whether they associate it with the ability to identify the origin of goods. Importantly, this assessment should not merely focus on the defendant’s subjective mindset but should instead evaluate the overall objective impact of the mark’s use in distinguishing goods. It is unnecessary to require that the mark definitively produce an identifying effect; rather, the key lies in gauging whether the mark has the potential to serve as a trademark for such purposes. In a recent case I represented, where the plaintiff filed a lawsuit alleging infringement of trademark rights and unfair competition [First-instance case number (2024) Lu 01 Zhi Min Chu 905], the defendant employed the term "Na Su Ban" in contract titles and labeled "Isolated Na Su Insulation Board" in sales contracts and detailed sales records. Furthermore, the defendant prominently featured "Isolated Na Su Insulation Board" on separate documents such as delivery notes, invoices, and certificates of conformity. During the first-instance proceedings, the Jinan Intermediate People’s Court ruled that the defendant’s use of the disputed mark indeed constituted trademark-like usage, thereby infringing upon the plaintiff’s registered "Na Su" trademark. In the subsequent appeal, the Shandong Provincial Higher People’s Court upheld this decision, concluding that the disputed mark appeared prominently in official transaction documents, clearly indicating its role as a trademark. The court further noted that while "isolated" and "insulation board" are generic terms lacking distinctiveness, the core term "Na Su" directly corresponds to the plaintiff’s registered "Na Su" trademark. As a result, the court found that the defendant had indeed infringed upon the exclusive rights associated with the plaintiff’s "Na Su" trademark.

Additionally, the "Guidelines for the Trial of Civil Disputes over Infringement of Trademark Rights by the Higher People's Court of Jiangsu Province (Revised Edition)" states: "2.4.1 The essence of trademark use lies in distinguishing the source of goods or services. At its core, trademark infringement involves undermining this function of identifying the origin of goods or services, thereby causing the relevant public to mistakenly believe that the goods or services originate from a particular source—or that there is a specific connection between them and the registered trademark. However, if the allegedly infringing mark is not used to distinguish the source of goods or services, it will not constitute an infringement of another party's trademark rights." Although China does not have explicit, codified provisions on this matter, courts across various regions have consistently treated whether the disputed mark constitutes trademark-like use as a prerequisite for determining infringement. This approach, while seemingly reasonable, may inadvertently lead to inconsistent application due to differing standards among regional courts, potentially granting judges excessive discretionary power—and even risking the creation of new legal principles. To address this, the author argues that the determination of trademark-like use should be based on a minimal threshold of distinctiveness sufficient to identify the mark. Moreover, a clear distinction must be drawn between legitimate defenses against the plaintiff’s trademark rights—such as fair use—and the critical assessment of whether the disputed mark itself qualifies as trademark-like use.

Assuming that the disputed mark is indeed used as a trademark, the next step involves comparing the disputed mark with the plaintiff's registered trademark. Articles 57 of the Trademark Law, along with Articles 9, 10, and 11 of the "Interpretation by the Supreme People's Court on Several Issues Concerning the Application of Laws in Hearing Civil Disputes over Trademarks (Revised in 2020)," outline the principles and methods for determining trademark infringement. Specifically, the standard requires comparing "the allegedly infringing trademark with the plaintiff's registered trademark," employing an isolation-based approach: "conduct both an overall comparison of the trademarks and a detailed analysis of their key components, with each comparison performed separately under conditions where the objects being compared are isolated from one another." In practice, as illustrated by the case I represented—(2024) Su 05 Min Chu 796—the defendant compared its own registered trademarks and packaging designs featured on the allegedly infringing products and packaging directly with the corresponding elements owned by the plaintiff, concluding that no likelihood of confusion existed. However, this comparative method was fundamentally flawed. According to the legal provisions and judicial interpretations, the proper approach to assessing infringement involves comparing the disputed mark against the mark as registered on the plaintiff's trademark certificate, while also juxtaposing the accused goods with the specific goods designated for use under the registered trademark. Only after such a thorough comparison can the various acts of infringement outlined in Article 57 of the Trademark Law be determined. Notably, using the same trademark identical to a registered mark on the same product without the permission of the trademark owner constitutes an infringement of the exclusive rights associated with the registered trademark—this is precisely the scenario of "identical trademark infringement" on identical goods. Under this rule, it is presumed that the coexistence of the disputed mark and the plaintiff's registered trademark would likely lead to consumer confusion or misidentification. Consequently, the court is not required to conduct a separate examination of actual confusion; rather, the determination of potential confusion is inherently embedded within the outcome of the infringement assessment itself. For instance, according to Paragraph 4.5, Section 2 of the "Guidelines on Evidence Rules for Intellectual Property Civil Litigation Cases Issued and Implemented by the Beijing Higher People's Court on April 22, 2021," if the plaintiff alleges that the defendant has used a trademark identical to its registered mark on the same type of goods, it is automatically presumed that such use has already created a likelihood of confusion. Additionally, under Article 57, Item (ii) of the Trademark Law, cases involving similar trademarks used on identical goods, identical trademarks used on similar goods, or even similar trademarks employed on similarly classified goods—all of which carry the potential to cause confusion—are subject to scrutiny regarding whether such use could reasonably lead to consumer confusion. Notably, in judicial practice, it is not necessary for actual confusion to have already occurred; rather, the mere possibility of confusion suffices to establish infringement.

It is worth noting here that when we say "identical trademarks," we mean that, visually, the allegedly infringing mark is virtually indistinguishable from the plaintiff's registered trademark. In judicial practice, courts across different regions have adopted varying criteria for determining identical trademarks, though there is an overall trend toward convergence. The author believes that the "Standards for Determining Trademark Infringement" issued by the National Intellectual Property Administration (Guo Zhi Fa Bao Zi [2020] No. 23) provides a relatively objective definition of identical trademarks. Specifically, Article 13 of these standards states: "A trademark identical to a registered trademark refers to one that is exactly the same as the other party's registered trademark—or, although differing in certain aspects, produces virtually no visual distinction or auditory perception difference in the case of sound trademarks, making it difficult for the relevant public to tell them apart." Meanwhile, Article 14 outlines specific scenarios where a trademark can be deemed identical to a registered trademark upon comparison: (1) For word trademarks, this includes cases where: 1. The textual composition and arrangement order are identical; 2. Changes to the font, letter case, or horizontal/vertical layout of the registered trademark result in no significant visual difference; 3. Modifications to the spacing between letters, numbers, or other elements within the trademark produce no noticeable visual variation compared to the registered trademark; 4. Alterations to the trademark's color do not affect its distinctive features; 5. Additional elements such as generic product names, common symbols, or model numbers are incorporated into the registered trademark without diminishing its distinctiveness. (2) For graphic trademarks, this applies when their compositional elements and visual presentation remain essentially unchanged. (3) For word-and-graphic combination trademarks, this occurs when the textual components, graphical elements, and their overall arrangement are identical, resulting in virtually no visual difference between the two trademarks. (4) For three-dimensional trademarks, this happens when the prominent 3D features and key 2D elements are either exactly the same or so similar as to be indistinguishable. (5) For color combination trademarks, this applies when the colors and their respective arrangements are identical or nearly identical. (6) For sound trademarks, this occurs when the auditory perception and overall musical impression are either identical or virtually indistinguishable. (7) Finally, any other scenario where the allegedly infringing trademark shares virtually no visual or auditory differences with the registered trademark. These standards are detailed and comprehensive, and as administrative and judicial practices continue to align, more and more regulations from administrative bodies are being accepted by people's courts.