Docket No.: 1040, second instance (终), administrative case (行), (2020) 01, Wuhan Intermediate People's Court of Hubei Province (鄂)

Lower Court Docket No.: 431, first instance (初), administrative case (行), (2019) 0102, the People's Court of Jiang’an District, Wuhan, Hubei Province (鄂)

SUMMARY OF THE ARGUMENT

Administrative complaints may form an administrative legal relationship, which should be highly concerned by the administrative authorities. They cannot be replied simply by letter; otherwise they may cause administrative charges against administrative omission.

Where the administrative organ does not have a comprehensive understanding of the content of a complaint, resulting in the obvious difference of its specific administrative actions and the content of the administrative complainant's complaint, and the disconnection of the administrative counterpart's complaint request, it is administrative inaction. Where the administrative reconsideration organ knows of an omission in the administrative decision made by the complaining administrative organ but fails to correct it according to law, and rejects the reconsideration application of the applicant, it is administrative inaction that fails to fully perform its reconsideration duties, and the administrative reconsideration decision(s) it has made shall be revoked.

STATEMENT OF THE CASE AND FACTS

WUHAN JIANGHAN DISTRICT LAOWANCHENG TRADING CO., LTD.,

Plaintiff-Appellee

v.

WUHAN MUNICIPAL ADMINISTRATION FOR MARKET REGULATION,

HUBEI PROVINCIAL ADMINISTRATION FOR MARKET SUPERVISION,

Defendants-Appellants

HANKOU LAOWANCHENG FOODS CO., LTD.,

Third party

April 16, 2019, Wuhan Jianghan District Laowancheng Trading Co., Ltd. ("Laowancheng Trading") complained in writing to Wuhan Municipal Administration for Market Regulation ("WAMR") that Hankou Laowancheng Foods Co., Ltd. ("Laowancheng Foods") was established later than Laowancheng Trading, but it had used the word "Laowancheng" in its company name. The company had also used the trademark "Laowancheng" held by Laowancheng Trading to produce similar products such as sour plum drink, causing misunderstanding and deception to the public and damaging the legitimate rights and interests of Laowancheng Trading. Laowancheng Trading requested WAMR to correct the registered business name of Laowancheng Foods in accordance with Article 41 of the Measures for the Implementation of Administration of Enterprise Name Registration. After WAMR received the complaint, it checked the original registration files of Laowancheng Trading and Laowancheng Foods, carried out investigations and talks with the two companies respectively, trying to fully understand the enterprise name registration of the parties in dispute, and issued a written Reply on August 16, 2019, which decided that: The review and approval registration procedure of the enterprise name of Laowancheng Foods was legal and in line with the Measures for the Implementation of Administration of Enterprise Name Registration.

Laowancheng Trading refused to accept the decision and filed on August 22, 2019 to Hubei Provincial Administration for Market Supervision ("HAMS") to apply for reconsideration. On December 5, 2019, HAMS made the Administrative Reconsideration Decision No. (2019) 24, which held that WAMR, in its written Reply, did not explain or respond to the question of "whether the production of similar products under the trademark of Hankou Laowancheng should be considered a factor for treating the case as a name dispute" raised by Laowancheng Trading, but had performed its major statutory duties in response to the content of the complaint application, which was to investigate and respond to the issue of whether the registration of Laowancheng Foods had been strictly examined; while the procedural error had not brought material impact on the parties. HAMS accordingly made the reconsideration decision to reject the application for administrative reconsideration.

Laowancheng Trading refused to accept the decision and filed a lawsuit with the People's Court of Jiang’an District, Wuhan, Hubei Province, requesting that the Reply of WAMR and the administrative reconsideration decision of HAMS be revoked, and that WAMR be ordered to make a new administrative act on the enterprise name dispute complained by Laowancheng Trading. The People's Court of Jiang’an District ruled at first instance that the defendant WAMR was ordered to perform the statutory duty of investigating whether the name of Wuhan Laowancheng Foods had infringed on the name and name right of Laowancheng Trading, and whether it should be ruled as unsuitable business name and be corrected; and that the administrative reconsideration decision made by the defendant HAMS in the case in question was revoked.

WAMR and HAMS did not accept the first instance judgment and appealed to the Wuhan Intermediate People's Court of Hubei Province ("Wuhan Intermediate Court").

Wuhan Intermediate People's Court found in the second instance that WAMR, in its administrative reconsideration process, had only reviewed whether the enterprise name registration of Laowancheng Foods was legal, before it made the determination that the name registration procedure was legal, but avoided the complaint request of Laowancheng Trading about whether "the already registered enterprise name is an inappropriate name and should be corrected", which, in fact, had not investigated what was complained, so WAMR's investigation and handling of dealing with the administrative complaint should be considered as administrative inaction. HAMS, in the process of its administrative reconsideration, had failed to act administratively and correct according to law about the complaint request for investigation and handling in the process of specific administrative actions of WAMR, and the existence of substantive issues and procedural issues in the administrative decision of WAMR had not been corrected timely, so it was an administrative act not fully performing the reconsideration duties. Therefore, the Wuhan Intermediate People's Court ruled in the second instance to dismiss the appeal and upheld the original judgment.

ANALYSIS

Subjects with relative administrative legal relations raise problems in the form of complaint letters, requesting investigation and handling, which is appealable. The administrative organs should have made the administrative reconsideration decisions in accordance with the law instead of simply responding to the petition letters. This case is exemplary to correct the administrative malpractice of administrative organs in not acting on petition cases and to guide the administrative organs to administer according to law.

"Laowancheng" is a century-old brand and a high-profile trademark with wide public awareness. Within the same competitive market, the historic brand name was registered by another company as the latter's business name, and the right holder disputed the inappropriate business name registered by the offender. It could request the supervisory authority of business name registration to carry out administrative investigation and handling, but also defend its rights through judicial proceedings. The administrative organs could directly correct the inappropriate enterprise name after having the facts checked, in which case, it could have saved the social resources and achieved the obvious protection effect with less effort. In this case, the court ordered the administrative organs to take administrative treatment actions within a period of time, providing an example of protection in solving the legal conflicts between enterprise names and historic brand names.