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With reference to Clause 44.1 of the Trademark Law in China, bad faith is one of the legal grounds when the brand owner is considering filing trade mark invalidation requests. In other words, this clause is set for the brand owner to claim its rights while being aware of that its brand has been certificated and granted to potential squatters. However, for the earlier stages before trade mark certificates have been issued, such as the publication period for a third party to file an opposition, there is a question that if the grounds of bad faith could be admitted by the Trademark Office.
Legal basics
In accordance with the Trademark Examination and Review Guidelines (2021), the situations regarding bad faith filings include harming public interests, unlawfully occupying public resources, or seeking undue benefits through improper means, to obtain registration, which can be referenced when dealing with controversial matters during the procedures of trademark opposition and refusal review.
Relevant precedents
The ruling in Guangzhou Honggu Limited v the CNIPO over an objection decision against the trade mark application No. 9387298 regarding a word mark ‘ATELIER COLOGNE’ highlighted that Clause 44.1 is one of the considerations when the court decides if a trade mark objection is convincible.
This trade mark application was opposed by the brand owner based on bad faith, which was supported by the CNIPO. As a result, the application was objected. The applicant submitted a review request to the court.
The court of first instance stated that the trade mark is a make up word and the applicant failed to provide proper explanation in relation to how this mark was created. In addition, there are 308 trade mark applications filed by the applicant, which are unreasonable amounts of filings in terms of common business sense. In this regard, the arguments based on bad faith in accordance with Clause 44.1 were supported by the judge. However, the applicant was not satisfied with the decision and further appealed to the higher court. His defence was that according to the Trademark Law, Clause 44.1 was introduced for the controversial procedure of post-registrations rather than pre-registrations. Therefore, this case should not adopt it to make a decision in favour of the brand owner.
The higher court agreed the judgment of the first instance and commented that the principle of Clause 44.1 was set to prevent the applications from granting in bad faith. If the authority has been aware of bad faith filings which meet the circumstances indicated in Clause 44.1 before the trade mark right has been granted, it is legally and sensibly to stop it from certificated. In this sense, the grounds of appeal by the applicant was dismissed.
Conclusions
Clause 44.1 in relation to bad faith filings is acceptable as one ground of opposition according to relevant precedents.
If you think your brand has been experiencing trade mark squatting, please do not hesitate to contact us.
