I.                    The rule for examining an affiliated trademark application

An application for registration of an affiliated trademark involves a trademark whose applicant owns one or more identical or similar marks that have been previously registered or applied for in connection with the same or similar goods or services. Such marks previously registered or under prior application may be collectively referred to as “earlier registrations.” The affiliation of such trademarks lies in the fact that they constitute similar marks on identical or similar goods, and their applicant and the owner maintain a certain relationship.

If an affiliated trademark violates the absolutely prohibitive clauses, such as Articles 10, 11 and 12 of the Trademark Law of the People’s Republic of China (Trademark Law), the registration should be revoked. Yet, registrability of an affiliated mark over an existing registration should generally be presumed or maintained in the absence of any violation of the absolute conditions. This is because under Article 28 of the Trademark Law a trademark may be denied registration when applied for only if it is similar to a mark owned by another used on or in connection with the same or similar goods, not to a mark that is owned by the same owner, for use with the same or similar goods.

However, even if an affiliated trademark application does not trigger absolute grounds for refusal, it may still nonetheless affect the examining determination or affirmation of its registration, when it is similar to a prior registered trademark owned by another person, or an unregistered trademark used by another person that has established a certain influence in the market, in the same or a similar class of goods or services, and when its registration or the affirmation of its registration may damage the prior rights of such other person. In this case, generally the elements to be considered will include any similarity between or among the affiliated trademark and the original trademark and the prior trademark, their application dates, their registration dates, their use and reputation, the effectiveness of the original trademark, and the registration or pendency of the affiliated trademark. It will be inappropriate to affirm the registration of the affiliated trademark solely on the account of the affiliation between the affiliated trademark and the original trademark, while disregarding any similarity between the affiliated trademark and the prior trademark owned by the other person. It will also be unsuitable to reject or revoke the registration solely on the account of the similarity between the affiliated trademark and the prior trademark of the other person, while disregarding the affiliation between the affiliated trademark and the original trademark.

II.                 If an affiliated trademark is similar to either the original trademark or a trademark of another person, consideration should be given to the use and reputation of the affiliated trademark and the cited trademark

Where an affiliated trademark is similar to either the original trademark or a prior trademark owned by another person, consideration should be given to whether the original trademark is identical with or similar to the prior trademark of such other person, the use and reputation of the affiliated trademark, and the registration or pendency of the affiliated trademark Generally, if the original trademark is neither identical with nor similar to the prior trademark of such other person, and if the affiliated trademark is similar to both the original trademark and the prior trademark of such other person in the same or a similar class of goods or services, then the use of the affiliated trademark and particularly, the use of the prior trademark of such other person will much influence the decision to approve or sustain the registration of the affiliated trademark.

In the administrative proceeding of the “好迪康” trademark opposition case, the trademark “迪康,” owned by Sichuan Dikang Technical Pharmaceutical Co., Ltd. in Chengdu (Chengdu Dikang), was registered and approved for use on goods in Class 3 “Perfumes” on May 13^th, 1997. The trademark “好迪,” owned by Guangzhou Houdy Group Co., Ltd. (Guangzhou Houdy), was registered and approved to be used on goods in Class 3 “Facial Washes” on January 21^st, 2000. Chengdu Dikang applied for the registration of the trademark “好迪康,” which was the center of dispute in the case, for use on goods in Class 3 “Bathing Liquids” on May 28^th, 2001. Guangzhou Houdy filed an opposition to the registration of the disputed trademark which, however, was approved by a ruling of the Trademark Office and the Trademark Review & Adjudication Board (TRAB). Disagreeing with the ruling, it requested a reexamination and brought an action against the decision of the TRAB. The court held that the identicalness or similarity between two trademarks should be determined mainly from the shape, pronunciation and meaning of their textual characters and particularly, whether the use of the trademarks on the same or similar goods will lead to confusion among the relevant public about the sources of or any relationship between these trademarks. In the case concerned, the disputed trademark “好迪 康” comprised the characters “好迪康,” and the cited trademark “好迪” comprised the characters “好迪” and an elliptical graph. For the relevant public, usually the main distinctive part of a trademark is a part that can be pronounced, which helps the relevant public to know the trademark. Thus the characters “好迪康” were the main distinctive part of the disputed trademark, and the characters “好迪” were the main identifying part of the cited trademark. Except a different character, the disputed trademark incorporated the main identifying part of the cited trademark. Because both “好迪” and “好迪康” were coined and never used as set phrases, the sole addition of the character “康” did not achieve any new meaning to distinguish “好迪康” from “好迪.” Coupled with the relatively high reputation of the cited trademark for cosmetic products, it would easily confuse the relevant public about any relationship between the disputed trademark and the cited trademark. Therefore, the disputed trademark was similar to the cited trademark in the similar classes of goods.

In the above case, the court considered as a whole such elements as the case being a trademark opposition case, without sufficient evidence of use of the disputed trademark, the non-similarity between the “迪 康” trademark of Chengdu Dikang and the “好迪” trademark of Guangzhou Houdy in different classes of goods, and the registration dates of these trademarks. In particular, except for the affiliation between the disputed trademark “好迪康” and the “迪康” trademark of Chengdu Dikang, the disputed trademark, once affirmed by the court, would lead to confusion about the sources of the disputed trademark and the “好迪” trademark of Guangzhou Houdy, because the “好迪” trademark had achieved a relatively high reputation in the market before the application date of the disputed trademark, and because the disputed trademark had not begun mass use and were still pending for registration. Therefore, it was inappropriate to affirm the registration of the disputed trademark.

III.               An affiliated trademark need not be canceled if its similarity to a prior mark of another person is resulted from similar goods and services so indicated in the classification of goods and services

If an affiliated trademark is similar to a prior trademark of another, but is used on goods or services neither the same as nor similar to those for that prior trademark in accordance with the Classification Table of Similar Goods and Services (Classification Table), then the affiliated trademark can still be approved for registration. However, if after the affiliated trademark is approved, it becomes similar to the prior trademark in the same or similar class of goods or services due to objective reasons, such as adjustments of the Classification Table, and the case should be dealt with in a careful manner instead of simply revoke the affiliated trademark.

In the administrative case of the dispute over the “洁柔” mark, the trademark No. 734525 “洁柔 and graph” (see the figure below) was granted to Qu Jiongsen to be used on sanitary pads on March 14^th, 1995, which lapsed upon expiration on March 13^th, 2005, and thus the removed from the register. The disputed trademark No. 3112825 “洁柔” (see the other figure below) was applied for by the same person on March 13^th, 2002, and granted to be used on goods in Class 5 “Sanitary Pads” on February 7th, 2004. The second cited trademark, owned by C&S Paper Co., Ltd. (C&S), was approved to be used on goods in Class 16 for “Toilet Paper and Tissue Paper” on December 17th, 1998. The third cited trademark, also owned by C&S , was approved to be used on goods in Class 16 for “Toilet Paper and Tissue Paper” on February 7th, 1999. On August 25th, 2008, C&S filed a request to cancel the disputed trademark registration. The TRAB held that the disputed trademark was similar to the second and third cited trademarks in the class of toilet paper, and ruled to cancel the disputed trademark on sanitary pads.

The ruling was affirmed by the court in the firstinstance trial. In the second-instance trial, the court held that the trademark No. 734525, owned by Qu Jiongsen, was applied on September 27^th, 1993, and did not expire until March 13^th, 2005. The trademark was approved to be used on sanitary pads. Before the expiration date, Qu Jiongsen applied for the disputed trademark by keeping the major part of the original trademark, that is, the textual part of “洁柔,” with some other changes. The new trademark was also approved for sanitary pads. Since Qu Jiongsen never intended to abandon the “洁柔” mark, the disputed trademark was deemed as a continuation of the trademark No. 734525. Although the Classification Table was modified in August 2002 to reclassify Class 5 “Sanitary Pads” as similar to Class 16 “Toilet Paper,” sanitary pads were not similar to toilet paper or tissue paper in accordance with the Classification Table validly existing at the time that the trademark No. 734525 and the disputed trademark were applied for. Since then, the disputed trademark had established a certain reputation among the relevant consumers on account of its actual use on sanitary pads. On the principle of fairness, from the historical perspective, to affirm its registration would be beneficial to maintain a stable market. Therefore, the court changed the original judgment and overturned the ruling of the TRAB.

In the above case, comprehensively the court considered the history and the uninterrupted use of the disputed trademark and the original trademark. In particular, it took into account the fact that sanitary pads, as approved for the disputed trademark, were not similar to toilet paper, as approved for the cited trademark, in accordance with the then Classification Table when the disputed trademark was registered. The situation remained unchanged until the Classification Table was adjusted thereafter. To protect the interests of the owner of the disputed trademark and the relevant public to rely upon the effective administrative act, considering the existing market segmentation formed by the continuous and uninterrupted use of the disputed trademark and the original trademark, the court finally decided it inappropriate to deregister the disputed trademark.

IV.               An affiliated trademark may be cancelled if it is more similar to a cited trademark than to the original trademark

Usually, registered trademarks are independent from each other, and any affiliation between them is all but an exception. Despite its affiliation with the original trademark, an affiliated trademark may be deregistered due to its more similarities to another prior trademark in a similar class of goods. In other words, the registration of the post affiliated trademark cannot be maintained solely on the account that the same registrant also owns the prior original trademark.

In the administrative case of dispute over the trademark “彩虹 RAINBOW and g raph,” the trademark No. 131415 (see the figure below), owned by YUNG CHI PAINT & VARNISH MFG. Co., Ltd.(Yung Chi Paint), was registered and approved to be used on goods in Class 2 “Paint” on October 31^st, 1979. Since it was not renewed upon expiration on December 12^th, 2006, it was deregistered according to law. The cited trademark “彩虹牌 CAIHONG PAI and graph” (see the figure below), owned by Nantong Xiongying Paint Co., Ltd. (Xiongying), was applied for on June 16^th, 1982, and registered and approved to be used on goods in Class 2 “Polyvinyl Acetate Latex Paint” on March 1^st, 1983. The exclusive trademark use right was renewed to be valid until February 28^th, 2013. The disputed trademark No. 1740936 “彩虹 RAINBOW and graph” (see the figure below) was applied for by Yung Chi Paint on January 19^th, 2001, and granted to be used on goods in Class 2 “Paint” on April 7^th, 2002. The exclusive trademark use right was valid until April 6^th, 2012. On March 28^th, 2006, Xiongying filed a request to invalidate the disputed trademark on the ground that the disputed trademark was similar to the cited trademark in the same or a similar class of goods. The TRAB held that the invalidating reasoning was established, and ruled to cancel the registration of the disputed trademark. The court held that similar trademarks are similar in the shape, pronunciation or meaning of their texts, or in the composition or color of their graphs, or in the integrated whole of the above elements, or in their stenographic shapes or colors, so that the relevant public will be likely confused about the origins or any relationship between the sources of the goods marked by one trademark and those marked by the other. In the case concerned, despite the different colors in their graphical parts, the cited trademark and the disputed trademark both had their distinguishing parts, that is, the textual parts, contain or only contain the characters “彩虹.” Thus, they were similar to each other due to the very similar shape, pronunciation and meaning of the main distinguishing parts. Similar goods are goods that have the same function, use, manufacturer, sales channel or target consumer, or goods which the relevant public usually believe them to be interrelated and likely confuses about. The cited trademark was approved to be used on the polyvinyl acetate latex paint, and the disputed trademark was approved to be used on paints and fire-protective coatings. Being both paints or coating materials, the two types of goods were extremely similar in their functions, uses, manufacturers and sales channels. Thus, they were similar goods. Therefore, the two trademarks were similar trademarks in similar classes of goods. Although Yung Chi Paint alleged that the disputed trademark continued and succeeded the original trademark, generally the exclusive use of a trademark cannot be continued or succeeded because of the independence of such right. Moreover, Yung Chi Paint failed to provide evidence on its actual use of the trademark No. 131415 (which was now invalid) and the disputed trademark in Mainland China to achieve any high reputation for these trademarks, or evidence on any long-term wide use of the disputed trademark to achieve any high reputation for the trademark in the relevant market or among the relevant public, or evidence on any distinguishing ability that the relevant public had developed between the disputed trademark and the cited trademark in the market. Coupled with certain differences between the trademark No.131415 and the disputed trademark, the existing evidences were insufficient to prove any continuation or succession in commercial goodwill between the original trademark and the disputed trademarks. On the basis of the above facts and reasons, the court ruled to affirm the ruling of the TRAB.

In the above case, the court took into account use and reputation of the disputed trademark, the cited trademark and the original trademark in the registration comprehensively. In particular, it held that the disputed trademark was somewhat different from the original trademark, and relatively more similar to the cited trademark. On the other side, the owner of the disputed trademark failed to provide sufficient evidences on the use or market reputation of the disputed trademark or the original trademark. Therefore, the court finally ruled to affirm the decision of the TRAB.

(Translated by Ren Qingtao)