In a recent case the Shanghai Number 2 Intermediate People's Court held that an imitation, although presented as a parody, constituted a violation of trademark rights.

The term 'shanzhai' is used to describe fake products, such as mobile phones, that are assembled in China from genuine parts procured from various factories, and use famous (usually foreign) luxury brands. Some commentators in China claim that such use of famous brands does not constitute infringement, since the products in question do not purport to have been produced by the brand owners and no confusion is possible. The court's judgment, which was issued on November 23 2011, appears to address this issue in a different context.

A Chinese company, Shanghai He Zhou Advertising Co, published an article imitating the famous Michelin restaurant guides, with a description and rating of French restaurants in Shanghai. The only difference was that the name 'Michelin' was spelt 'Micheling'. Michelin's famous Bibendum device was also reproduced. The article appeared in That's Shanghai magazine and on the magazine's website.

Michelin brought an action before the court. The defendant's arguments were contradictory in some respects. It it admitted at the beginning of the magazine article that it had "introduced a copycat Micheling rating system", but nonetheless claimed that the two trademarks were dissimilar. The court rejected the defendant's claim of dissimilarity and considered that the supposed warning in the article - which alluded to the concept of 'shanzhai' - was insufficient to avoid causing harm to the trademark owner.

The court concluded that the defendant's acts constituted trademark infringement. The court ordered that the defendant cease publishing the magazine and, noting that 60,000 copies had already been circulated, awarded Michelin Rmb60,000 in damages.

For further information on this topic please contact Paul Ranjard at Wan Hui Da Law Firm & Intellectual Property Agency by telephone (+86 10 6892 1000), fax (+86 10 6894 8030) or email ([email protected]).