"Trademark Parody" refers to the emulation and modification of the trademarks of others for the entertainment purposes of humor, irony, or criticism. The Trademark Act of Taiwan does not stipulate the legality of trademark parody. However, some court rulings have confirmed, based on the values of freedom of speech, freedom of expression, and freedom of art, that trademark parody does not constitute trademark infringement.

Thus, even though the trademark parody and the parodied trademark possess a certain level of difference, there must be a certain level of similarity between the two in order to attain the desired effects of "entertainment purposes of humor, irony, or criticism." Therefore, it is unclear how to attain a balance between the legal objective of "avoiding confusion" under the Trademark Act and the protection of the "freedom of speech."

The Intellectual Property Court, in civil judgement 2018 Min-Shang-Su-Zi No. 1 made on January 23, 2019, expressed their opinion on the delineation between and determination on the two preceding legal interests. In this particular case, a beauty care and makeup product manufacturer (Defendant A), and another manufacturer that had been involved in multiple mock-ups of classic luxury bags (Defendant B), had collaborated to manufacture products such as a compact cushion, compact mirror, and canvas bag. The said products were imprinted with a graphic of a bag which was highly similar to the design of a handbag produced by the Plaintiff, an internationally well-known luxury manufacturer; said products also used classic flower patterns and colorways that were highly similar to those of the Plaintiff.

With respect to the preceding situation, the Intellectual Property Court decided as follows: "Trademark Parody" is the emulation of well-known trademarks for the entertainment purposes of humor, irony, or criticism; it must convey dually conflicting information, and must attain a balance between the two public interests of "avoiding confusion" and "freedom of speech." The judgement further pointed out that although the pattern accused of infringement did lead consumers to associate that pattern with the original trademark, if the parody did indeed successfully mock and ridicule the original trademark while manifesting the public interests of artistic originality and freedom of speech and did not lead to any likelihood of confusion and did not lead to any likelihood of damages to the trademark distinctiveness or reputation, then it is not restricted by the trademark rights of the original trademark and should be protected as well.

In this case, the Intellectual Property Court believed that the pattern on the accused products did indeed resemble the original trademark to a degree sufficiently high to cause consumers to associate that disputed pattern with the original trademark. However the accused products did possess differences with the Plaintiff's luxury, fashionable brand name bags, and adopted consistent societal reflections, which were indeed presentations of the public interest of freedom of speech and freedom of art. In addition, the accused products were beauty and makeup products, whose primary target consumers are women who are highly sensitive to fashion-related information, highly attentive to brand name products and thus possess the sensitivity requisite to determine that the original and the parody do not come from the same source. Defendant B's company has continuously transmitted a mock environmental fashion brand image in Taiwan since 2012, and the accused products displayed patterns and brand names representing the crossover of Defendants A and B on both the top and bottom of the same side of the product, which would further allow the viewer to realize that the product was a parody, abundantly showing that there was no likelihood of confusion and no likelihood of damages to the trademark distinctiveness or reputation. Therefore, it was decided that the products accused of infringement are not restricted by the rights of the original trademark, and should be protected as trademark parody.