You’ve probably heard stories of fake Apple stores in China.
These stores completely copy the Apple store from the all-white decor to the
blue shirt wearing salespeople. With all stories, I wonder: how can these
storeowners get away with this? No store in United States could even get away
with copying the blue shirt styles let alone the all white décor. However,
“Trademark squatting in China doesn’t sit well with U.S. retailers” by David
Pierson of LAtimes.com explains the fake Apple stores, along with the fake
Kardashian, Justin Bieber, J. Crew, Jordan, and Eminem brands in the Chinese
market.
The article reports, in China “trademarks generally are
awarded to those who are first to register them with government authorities. If
these and other U.S. companies want to use their own names, they probably will
have to pay the Chinese holder for the rights”. In the U.S., trademarks are
awarded to those that use them first. So, if an established U.S. brand tries to
move into China and the name is trademarked, under Chinese law, the trademarked
user could charge the U.S. brand to use their name. Example in article, “In
northeastern Liaoning province, someone owns the trademark to make clothing
under the Oprah Winfrey brand.”
The exception to the law is to prove that the trademark
holder in China registered in bad faith. Although, Stan Abrams a law professor
in Beijing is quoted saying “The system here on the whole is geared towards
first to file, and it takes a lot of time and effort to rebut the presumption
that the registrant filed in bad faith” Hermes International, Chivas Bros, and
Pfizer Inc. have tried to file suits and have failed. Apple and Michael Jordan are currently involved in suits
against companies making revenue from their names.
Throughout the article, many of the trademark users in China
gave no comment, with the exception of Xu Junwu and Zhen Yongyu. Xu Junwu owns
the trademark for J. Crew. His “good faith” defense of using the brand name:
“said he’s never heard of the U.S. clothing chain and explained that his sales
team came up with the name”. In
his own words “They just picked something easy to remember without a lot of
letters… we’ve put a lot of effort into building this brand, we’re recognized
in China” The last part of that quote is his response to whether he would
charge J. Crew to use their own name in China.
Zhen Yongyu owns the name Eminem and claims, “I’ve never
heard of Eminem… If this Eminem turns out to be a famous singer, we’re willing
to cooperate as a potential partner to release this brand in China. We’re also
open to selling it.”
There’s no other word to describe this “trademark squatting”
other than bull#hit. I apologize for the word but I truly honestly, in good
faith, can’t think of any other word that truly embodies this entire scheme.
Oprah, Eminem, Apple, Michael Jordan, and any other well established
celebrities and brands will have to pay to use their own name/brand. In order
to reclaim their brand, first will have to prove that the other person did it
in bad faith. Explain to me how a “team” picking a name out of air and oops, it
happened to be a well-established brand is a “good faith” defense. I’m pretty sure that these trademark
owners in China have access to some form of media that allows them to search
names. Who hasn’t heard of Eminem, Oprah Winfrey, or Michael Jordan?
Most brands will likely seek legal action instead of paying
for their name. Or they might ignore the market altogether. Last thought to
consider: this might sound like a smart extortion plan for the trademark holder
but doesn’t this scare U.S. retailers from entering the Chinese market?
