The Supreme People’s Court has recently made a judgment on the re-trial case concerning the trademark Reg. No. 3060409 “采埃孚 (ZF in Chinese)”, with ZF LENKSYSTEME GMBH (ZF GMBH) vs. Trademark Review and Adjudication Board (TRAB) and Huichang Electrical Machinery Co., Ltd (Huichang Company). According to the judgment, the Supreme People’s Court finally supports ZF GMBH’s re-trial request, by deciding that the disputed mark infringes upon ZF GMBH’s and its Chinese related companies’ prior trade name rights to “采埃孚” and thus violates Article 31 of the former Chinese Trademark Law. Furthermore, the Supreme People’s Court revokes the judgments made by the courts of the first and second instance and the decision made by the TRAB.

ZF GMBH, as a major partner of many world-famous automakers, is among the largest companies engaged in the development, production and sales of steering systems for passenger cars and commercial vehicles. On January 4, 2002 Huichang Company filed the trademark “采埃孚 (ZF in Chinese)”, which was approved for registration on July 28, 2003 on the goods “hydraulic pumps, hydraulic valves, pumps (machines);pumps (machines);pumps (parts of machines, engines or motors);hydraulic components (not including vehicle hydraulic system);oil pump and other goods; etc.” in Class 07. ZF GMBH asserted: prior to the filing date of the disputed mark, ZF GMBH and its related Chinese companies (the interested parties) had adopted the words “采埃孚” as their Chinese trade name and this Chinese trade name had enjoyed high reputation in the relevant field; the registration of the disputed mark violates Article 31 of the former Chinese Trademark Law, which will not only damage the legitimate rights and interests of ZF GMBH and its related Chinese companies, but also will cause confusion among the relevant public; the registration of the disputed mark should be canceled. However, ZF GMBH’s arguments were not supported in the invalidation procedure and in the judicial procedures of the first and second instance.

Against the unfavorable judgment made by the court of the second instance, the attorneys HU Gang and QIU Jing of CCPIT comprehensively analyzed the relevant judicial issue and concluded that the judgments made by the courts of the first and second instance equated “the interested party” in Article 41(ii) of the former Chinese Trademark Law with “the interested party” in Article 53 of the former Chinese Trademark Law and interpreted this item as “licensees and legal successors of relevant rights”, which is one-sided and narrow-minded. Their judgments based on the narrow interpretation should be revoked. Therefore, ZF GMBH carefully prepared the evidence and lodged the re-trial request with the Supreme People’s Court.

After examination, the Supreme People’s Court held: existing laws and regulations fail to give a clear definition to the term “the interested party” in Article 41(ii) of the former Chinese Trademark Law; in the current judicial practice, the term “the interested party” is mainly presented in the form of licensees and legal successors, however, the scope of the “the interested party” should not be so limited, other parties who are proved to have a stake in the case can also request for cancelation of the registered mark in accordance with Article 31 of the former Chinese Trademark Law; the identified goods of the disputed mark are closely related to the steering systems and related automotive components produced and sold by Shanghai ZF, the interested party of ZF GMBH; the registration of the disputed mark by Huichang Company, a company engaged in the same field, violates the prior trade name right of ZF GMBH and its related companies; the judgments made by courts of the first and second instance that the registration and use of the disputed mark do not violate Article 31 of the former Chinese Trademark Law are not based on sufficient factual and legal grounds and shall be corrected.

The success in the re-trial case puts an end to the 10-year long invalidation against the disputed mark and finally has cancelled the registration of the disputed mark. The success effectively defends ZF GMBH’s and its related Chinese companies’ trade name right and protects the relevant public from confusion and misrecognition.

This re-trial is one of the most challenging cases that CCPIT Patent and Trademark Office has ever handled. It is also the first time that the Supreme People’s Court made an express interpretation to the term “the interested party” in Article 41(ii) of the former Chinese Trademark Law. The interpretation will serve as a significant milestone for the examination of the relevant cases in the future.