On December 20, 2012, the Supreme Court ruled en banc that a certain shape or form affixed to a specific location on a product may be recognized as a trademark classified as a “position mark” if such mark can be used to distinguish the product from others (Supreme Court Decision en banc, Case No. 2010 Hu 2339, December 20, 2012).

This case relates to a trademark application filed by Adidas for a three-line mark on a sportswear top that runs vertically from the side of a torso to the waist. The key issue in this case was whether the three-line mark is distinctive enough to warrant a registration as a trademark. At the court of first instance, the court had found that the subject mark is a figure mark composed of a combination of a sportswear top figure and three thick lines. The figure of the sportswear top is an ordinary depiction of the designated good, and as such, lacks distinctiveness. Also, the three thick lines are merely an ornamental pattern rather than an independently distinctive mark. Therefore, the court ruled that the subject mark is a descriptive mark or lacks distinctiveness.

However, the Supreme Court ruled that the part of the subject mark that indicates the shape of the designated good is merely for an indication of where the three thick lines will be positioned, and as such, the subject mark where the three thick lines run from the side of a torso to the waist constitutes a trademark classified as a “position mark” which operates to distinguish the product from others. Accordingly, the Supreme Court’s ruling overturned the previous decisions of the court where it ruled likewise on all cases that a mark composed of a shape of a designated good is considered to be using the shape of a designated good in a common way, without examining the specific meaning of such shape of a designated good in a mark (Supreme Court Decision, Case No. 90 Hu 168, September 25, 1990; Supreme Court Decision, Case No. 2003 Hu 1970, July 8, 2004; Supreme Court Decision, Case No. 2003 Hu 1987, July 8, 2004).

Furthermore, the Supreme Court ruled that even if the form or the shape comprising the position mark is not distinctive in and of itself, the position mark will be recognized as distinctive and registrable as a trademark if it is recognized at large as an indication of goods from a particular entity by being affixed to goods and used.

This en banc decision from the Supreme Court is significant in that the Supreme Court, for the first time, has recognized the concept of a position mark and offered a standard for recognizing distinctiveness thereof.