A Chinese company has started expanding its number of outlets in north China. The English name of the stores is Natural Mill, while the Chinese characters — 無印良品 — are identical to those used by the Japanese lifestyle products brand Muji.
Unfortunately for Muji, it has no legal recourse.
In 2016, Natural Mill, whose parent company is Beijing Cottonfield Textile Corp, filed a trademark infringement lawsuit against Muji’s Japanese parent company, Ryohin Keikaku Co, Ltd and its Chinese-registered company Muji (Shanghai) Commerce Corp.
Note that the plaintiff in this case was Natural Mill, the company that is knocking off the Muji trademark, while the defendant is poor old Muji.
Last year, on Christmas day, a Beijing court handed down its verdict, ruling that the plaintiff had the right to use the trademark and should be accorded due legal protections.
As a result, all of the products, product packaging and promotional literature for products sold by the defendant — including bathroom towels, face towels, duvet covers, pillowcases and bathroom accessories using the trademark or proximate versions thereof, such as 無印良品, Muji無印良品 and 無印良品Muji, would be considered to infringe the registered trademark and the defendant should accordingly cease all use of them.
Beijing Cottonfield Textile was founded in 1998; Japan’s Ryohin Keikaku was established in 1980. Unfortunately, Beijing Cottonfield Textile registered the trademark in China before the Japanese company did.
Under the Trademark Law of the People’s Republic of China, the legal guarantees accorded to the knockoff trumped the rights of the original — foreign — brand and the latter was also required to pay compensation to the tune of 626,000 yuan (US$90,190 at the current exchange rate).
This, one may presume, is an example of rule of law with Chinese characteristics.
Not long ago, US President Donald Trump and US Vice President Mike Pence, on separate occasions, accused China of exploiting its market advantage to plunder and plagiarize the intellectual property rights of US companies operating in China.
However, the Muji trademark infringement case takes the whole thing to a new level. It is like the mistress doing away with the wife and then asking the wife to pay compensation.
A few years ago, when I was riding on a bus in Beijing, I saw an advertisement for Beijing Chang Gong Memorial Hospital (北京長庚醫院). The logo, just like the characters in its name, were identical to Chang Gung Memorial Hospital in Taipei, and it advertised that it specialized in treating male afflictions.
It is perfectly possible to suppose that, if the Taipei Chang Gung Memorial Hospital decided to open a branch in Beijing, it would be faced with the question of whether it can use its own name, or whether it could continue using its trademark.
The problem is not about scale; it is about the fact that it is Taiwanese, with the wrong approach to the “united front.”
Yu Kung is a businessman.
Translated by Paul Cooper
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