The Gap grabs damages award

The Gap Inc, one of the world's largest clothing retailers, has won trademark infringement and unfair competition actions against six catering companies in Shanghai and has obtained an award of damages in the sum of Rmb500,000 (approximately $62,500).

The defendants included Shanghai He Hua Commercial Management Co Ltd, He Ting Dining Management Co Ltd, Shanghai Xiao Ting Industry Co Ltd and You Yi Ting Dining Co Ltd.

In November 1998 The Gap registered GAP as a word mark and a GAP DEVICE mark for dress designing and dress designing consulting services in China. In November 2001 and January 2002 it also registered the GAP word mark and GAP device mark in relation to restaurant services in China. The Gap has, for many years, been listed among the Fortune 500 companies and its GAP marks had acquired an extensive reputation in China.

In 2003 The Gap discovered that the six local companies were using marks similar to its GAP marks on their company notice boards, menus, crockery and other items. It initiated legal proceedings in the Shanghai Second Intermediate People's Court, seeking an injunction, an order for destruction of infringing goods and labels, and compensation of Rmb500,000.

The court considered that:

• the marks used by the defendants were similar to The Gap's trademarks in language, character, pronunciation and meaning;
  
  
• the defendants had been using the marks in relation to restaurants and restaurant services; and
  
  
• it was likely that relevant consumers would be misled.

Accordingly, it held that The Gap's trademarks had been infringed. Because the defendants had intended to evade the law and 'free-ride' on the fame and reputation of the GAP marks, they had also engaged in unfair competition. Consequently, the court ruled in favour of The Gap.

Jin Ling, Rouse & Co International, Beijing