Xiangrong Wu August 8 2022 Beijing High Court's invalidity decision makes prosecution of 3D marks in China unclear Wanhuida Intellectual Property | Intellectual Property - China Xiangrong Wu Intellectual Property FactsTRABBeijing IP CourtBeijing High CourtCommentFactsFlamagas SA is a Spanish manufacturer of cylindrical shaped lighters, which are marketed under the brand Clipper. Flamagas owns the 3D trademark registration shown in Figure 1, containing the word mark CLIPPER (the Clipper mark), designating goods including lighters for smoking, cigar cutters and pipes, among others, in class 34 in China.Figure 1: the Clipper markOn 23 April 2018, a Chinese rival, Shaodong Lotus Lighter Manufacturing Co, Ltd (Lotus), filed an invalidation application against the Clipper mark, contending that it was devoid of distinctiveness and thus should be invalidated.TRABThe Trademark Review and Adjudication Board (TRAB) (later integrated into the China National Intellectual Property Administration (CNIPA)) found that the Clipper mark consisted of a 3D lighter shape and a representation of the word "CLIPPER". Though the 3D element was devoid of distinctiveness, the word element was distinctive, which made the Clipper mark distinctive as a whole. On 28 April 2019, TRAB overruled Lotus's petition and maintained the registration of the Clipper mark.Flamagas later filed an administrative lawsuit before the Beijing Intellectual Property Court to challenge the TRAB finding regarding the non-distinctiveness of the lighter shape of the Clipper mark.Beijing IP CourtOn 23 December 2019, the Beijing IP court dismissed Flamagas's petition. The Court found that the simple design of the 3D shape, which was likely to be identified by the relevant public as the shape of a lighter in general, rather than as a source identifier, was not inherently distinctive. Also, the evidence failed to prove that the shape had acquired a secondary meaning through extensive use. The Court therefore confirmed the finding of the TRAB.Flamagas appealed to Beijing High Court.Beijing High CourtThe Beijing High Court opted to ascertain the distinctiveness of the Clipper mark in its entirety, rather than focusing merely on the 3D shape component.The Court first assessed the functionality of the litigious mark. It opined that the design of the lighter – which was neither "the mere indication of the shape inherent in the nature of the goods concerned", nor "only dictated by the need to achieve technical effects or to give the goods substantive value" – was not functional.In terms of the assessment of distinctiveness, the Court explicitly enumerated the parameters to be weighed up in general – namely:the intrinsic meaning of the sign by itself;the designated goods/services;the thought processes of the relevant public; andthe actual use of the litigious mark in the relevant industry.The Court specifically underscored the employment of a holistic approach in assessing the distinctive features of a litigious mark with a 3D element, noting that, in principle, the mark could not to be deemed distinctive simply because it contained a word, device or other elements.The Court held that the Clipper mark was a 3D shape in line with the regular shape of lighters and that word element "CLIPPER" incorporated in the shape was too inconspicuous to be noticed by the relevant public when paying a general level of attention. When used in its entirety on lighters for smoking, the litigious mark would be "the mere indication of the shape inherent in the nature of the goods". Conversely, when being used on other goods, it would be perceived as packaging or an ornamental pattern by ordinary consumers. Thus, it failed to function as a source identifier. The Court also sided with the IP Court in holding that the litigious mark was yet to acquire distinctiveness through extensive use and promotion.On 15 December 2021, the Court rescinded the TRAB decision maintaining the registration of the Clipper mark and ordered the CNIPA to remake an invalidation decision.CommentThe Clipper case exemplifies article 9.8 of the Guidelines of the Beijing High People's Court for the Adjudication of Cases Involving Granting and Affirmation of Trademark Right (2019), which reads:If a litigious trademark consists of a three-dimensional sign, it shall be judged as a whole as to whether the trademark is distinctive. In general, this trademark shall not be determined as distinctive for containing any words, graphic or other elements. (Emphasis added.)The guidelines are a surprising divergence from the Court's previous practice.In June 2017, the Beijing High Court refused the application for a 3D mark containing the word element MONTBLANC MEISTERSTUCK (Figure 2), finding the words and graphic in the mark inconspicuous and that the applied mark was more likely to be identified as the shape of a pen, rather than a source identifier. Following the reasoning of this case, it seemed safe to infer that "a 3D mark may be deemed distinctive as a whole, provided that the words, graphic, or other components of such mark can be easily identified".Figure 2: rejected 3D markThe newly revised Trademark Examination and Adjudication Manual (effective as of 1 January 2022) uses the MONTBLANC MEISTERSTUCK mark as an example of a non-distinctive 3D mark. Nevertheless, the manual notes that a 3D mark consisting of a non-distinctive shape and distinctive 2D elements (see Figure 3) is generally regarded as distinctive in its entirety.Figure 3: admissible 3D trademarks covering tobacco, distilled water and cosmetics goods, respectivelyThe incoherent methodology adopted by the Beijing High Court and the CNIPA could further complicate the prosecution landscape of 3D marks in China. Even if a 3D mark could pass the functionality check and distinctiveness test of the CNIPA, it may not survive the rigorous scrutiny of the Beijing High Court if its distinctiveness is neither intrinsic nor acquired, but solely hinges on other elements incorporated in the 3D shape. In practice, brand owners are strongly recommended to gather evidence on the extensive use and promotion of their 3D marks and in the meantime seek alternative routes (eg, filing design patents and/or registering copyright) to add extra layer of protection to their 3D shapes.For further information on this topic please contact Xiangrong Wu at Wanhuida Intellectual Property by telephone (+86 10 6892 1000) or email ([email protected]). The Wanhuida Intellectual Property website can be accessed at www.wanhuida.com.This article was first published by WTR.