Fame in mainland China supports Hong Kong bad-faith registration claim

The registrar of trademarks has upheld an opposition filed by the owner of a mark that is well known in mainland China but little known in Hong Kong on the grounds that the applicant had registered the mark in bad faith.

The mark under opposition is a composite mark consisting of the word DAPHNE and three Chinese characters pronounced 'da-fu-ni', a close transliteration of 'daphne'. The application covered goods in Classes 3, 5 and 32 of the Nice Classification.

The opponent is the subsidiary of a company listed on the Hong Kong Stock Exchange. It owns the registered trademark DAPHNE and a Chinese mark comprising the same three characters as the Chinese word element of the opposed mark. The opponent's registrations cover goods in Classes 18, 25 and 26.

The evidence submitted by the opponent showed that it had invested heavily in promoting its marks in mainland China and that its goods have topped the sales for these types of products in China for the past 10 years. The registrar agreed that the opponent's marks had been in use for a long time and were highly reputed in mainland China. However, the registrar pointed out that:

• the opponent's goods are not sold in the Hong Kong market; and
  
  
• the only exposure of the Hong Kong public to the opponent's marks is through business reports on the opponent's listed parent company in the financial news.

The opponent also claimed that the application had been filed in bad faith. It submitted information downloaded from various websites whereby the applicant had applied for the registration of a total of 13 trademarks (including the opponent's marks) which are well known in mainland China but not registered in Hong Kong.

The registrar accepted that at the time of filing of the trademark application, the applicant must have been aware of the existence of the opponent's marks. Applying the combined subjective and objective test in Twinsectra Ltd v Yardley ([2002] 2 AC 164) and Ajit Weekly Trademark ([2006] RPC 25), the registrar considered whether the applicant's conduct was dishonest judged by "ordinary standards of honest people", in light of the fact that the applicant knew of the opponent's marks and that these marks were well known in mainland China.

The registrar held that the applicant must have intended to take unfair advantage of the reputation of the opponent's marks in mainland China to mislead the public into thinking that the opposed mark belonged to the opponent and that the applicant's goods were the opponent's goods. Moreover, the conduct of the applicant prevented the opponent from extending its marks to Hong Kong. The registrar thus refused to register the mark on the grounds that the application had been filed in bad faith.

Rebecca Lo, Rebecca Lo & Co, Hong Kong