On September 21 2016 the Supreme Court affirmed(1) without opinion an earlier high court decision(2) which held that a bakery shop's general appearance (including its logo, outdoor signage and indoor layout) and other trade dress elements were protected under the Unfair Competition Prevention and Trade Secrets Act.
As South Korea lacks express trade dress IP rights, this case is noteworthy as it is the first time that the Supreme Court has specifically recognised the protection of such rights in shop interior and outdoor decorations under the law. Further, the case serves as a test case for interpreting the new 'catch-all' provision of the Unfair Competition Prevention and Trade Secrets Act.
The case was originally brought by Seoul Lovers (doing business as Slowfood-Korea, Inc), a premium bakery shop known for serving freshly baked sweet red bean pastries, against a competing bakery shop founded by a former employee of Seoul Lovers and his business partner. The defendant bakery clearly imitated Seoul Lovers' appearance and design, as the following comparison shows.
Because South Korea does not specifically provide for trade dress protection under its trademark laws, Seoul Lovers brought an action against the defendants under Article 2(1)(x) of the Unfair Competition Prevention and Trade Secrets Act (commonly known as the 'catch-all' provision), claiming that by copying Seoul Lovers' trade dress, the defendants were unfairly profiting from the infringement of Seoul Lovers' intellectual property, which it had developed through significant effort and expense.
The high court agreed that the appearance and design elements claimed by Seoul Lovers as its trade dress were the result of considerable effort and investment by Seoul Lovers to distinguish itself from other bakeries, and that the defendants were engaged in unfair and improper business practices by free riding on Seoul Lovers' goodwill, thus meeting the requirements of Article 2(1)(x) of the Unfair Competition Prevention and Trade Secrets Act. By affirming this decision, the Supreme Court has clearly signalled that the high court's interpretation was correct, and that trade dress in shop decorations can be protected in South Korea under the Unfair Competition Prevention and Trade Secrets Act.
For further information on this topic please contact Mikyung Choe, Chunsoo Lee or Seung-Chan Eom at Kim & Chang by telephone (+822 3703 1114) or email ([email protected], [email protected] or [email protected]). The Kim & Chang website can be accessed at www.kimchang.com.