Partner and Retail team member Ian Gill gives a short insight into defending WowWee’s rights against Chinese applicants

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Those with young children will likely have heard of Fingerlings, but for those who have not Fingerlings are the wildly successful children’s toy released in the US and Canada in 2017 which became the number one selling toy in the US the Christmas of 2017.

As you can Fingerlings toys wrap around your finger and they come in shapes such as monkeys, unicorns, pandas and dragons – they react to touch and sound by blinking and even blowing kisses.

Fingerlings are produced by WowWee, a Hong Kong-based company which continually produces innovative children’s toys.

The success of Fingerlings toys ensured they were the subject of a sustained counterfeiting effort and we dealt with a significant number of seizures in the UK under instruction of our colleagues at the US firm Epstein Drangel. We worked closely with UK Trading Standards in many offices throughout the UK to ensure they had suitable guidelines to assist in spotting counterfeits, responded promptly to their queries and providing declarations confirming infringement where requested to assist in the seizure of goods and to encourage them to seek out further infringements.

The level of counterfeiting was not unexpected given the sustained success of the Fingerlings toy, and we put in place a series of European registered design applications and European trademarks to protect the product, but one area which was less expected was a wave of European registered design applications filed by various Chinese entities.

The applications related to toys which were identical to or nearly identical with the Fingerlings toys and in each case we have successfully cancelled the registrations either because they lacked novelty or individual character, where there are minor differences. The registrations are being granted because there is no formal substantive examination in relation to European registered design applications.

None of these cases have been defended by the applicants so why are these applications being filed being filed?

The Chinese applicants are incurring costs in filing applications to the must be some benefit to them. It is possible that they hope to rely on the registrations if their products are challenged as counterfeits and we have seen one case with UK Trading Standards where the infringer did point to a registration but this was easily dealt with by referring Trading Standards to our own earlier registrations of near identical toys.

Another possible reason for these filings could be Chinese government subsidies. We have spoken with Chofn regarding this issue, a Chinese law firm we work with regularly, and they have confirmed the Chinese government, at provincial level and municipal level does subsidise Chinese applicants for obtaining overseas patents and designs. The subsidies are decided at a local level and they will vary considerably. The registered designs that we cancelled were filed in 2017 and my understanding from Chofn is that the subsidies have been curtailed since 2018 so we may see a reduction in this type of behaviour but this issue does highlight one of the drawbacks of the European registered design system which is that in the interests of low application fees and rapid grant – registrations can be granted in a matter of days – sacrifices to be made regarding the quality of the examination process and the grant of the registration brings with it no presumption of validity.