Counterfeit brand Supreme Italia loses registered trademarks in China

However, as of last week, these will be revoked following opposition, with the CTMO stripping Supreme Italia of its legal trademark ownership.

The move follows legal action by Supreme New York which has accused Supreme Italia of defrauding Chinese consumers and misleading law enforcement, reporters, and even global companies like Samsung by setting up a copycat retail store.

Supreme US officially sought support from the Chinese government in its trademark infringement action.

According to the CTMO, Supreme US do not currently own any registered trademarks in China. However, the database shows the brand has 85 trademark applications, all of which are pending.

The action follows the launch by Supreme Italia of two retail stores in Shanghai, which use the brand logo and contain branded Supreme products, including collaboration ranges such as Rimowa x Supreme.

Melanie Zhu, principal, at Rouse Consultancy, a global IP consultancy, told The Drum, that Chinese trademark law has traditionally favored the first company to register a trademark.

“Trademark protection is territorial, a mark registered in the US is not automatically protected in other countries, and the owner has to go through the trademark application procedure to seek the protection of the mark in other jurisdictions.

“In mainland China, trademark protection mainly adopts a first-to-file principle, say, those who first apply for and register the marks have the legal ownership over the marks. Of course, when there are trademark disputes means to help the genuine owners to retrieve the marks if the marks are preemptively registered by bad faith squatters."

Zhu said China has issued new trademark laws, which comes into effect in November 2019, to counter “bad faith issues” and it is believed this will help to improve the situation for legitimate brands which find their trademarks already taken by counterfeit companies or squatters.

Australia’s Treasury Wine Estates, which owns the prestigious Penfolds brand, won a landmark legal dispute in 2017 to reclaim its trademark, which had been registered by a Chinese individual in 2009.

Beijing’s High People’s Court awarded the company the right to use the “Ben Fu” trademark in China, a transliteration for the Penfolds brand, after finding the individual had failed to demonstrate any genuine use of the trademark for wine or related business activities.

According to Zhu, brands need to plan their global strategy in advance to launching into the China market, to ensure they retain their registered trademarks for goods and services. She added that as trademark registration and protection laws in mainland China do not cover Hong Kong, Macau and Taiwan, brand owners must also seek trademark protection in all of these areas to ensure full coverage across Greater China.

If a brand discovers its trademark has already been registered it can file an opposition or invalidation, depending on the time period since the mark was registered, or attempt to negotiate with the company or squatter to convince them to voluntarily de-register the trademark.

“In the short run, the brand owner should fight hard to retrieve the hijacked mark to keep the global trademark integrity and to avoid consumer confusion. In the long run, comprehensively protect and enforce the IP - obtain support from Chinese officials.

“From the PR/marketing perspective, the brand owner should launch the media campaign to communicate correct information about the brand positively in the media to educate the Chinese consumers who are the genuine/original brand and the correct channel from whom to purchase your goods/services.

“If Chinese consumers have been confused and mislead, positive steps need to be taken to address and assure them that you are resolving the situation; and you will need to obtain public and government relation assistance from someone who knows the market so as not to make the situation worse,” said Zhu.

The Drum previously looked at how China can shed its copycat reputation as the government now considers intellectual property protection key to the success of the country’s homegrown global brands.