Design patents or trade dress: protecting intellectual property in China

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Identifying a direct line to a successful IP portfolio in China is not easy. There are many variables in the equation, including knowing the gray areas between the lines of the law of black letters and the ability to be creative. It is this last variable which often plays the most important role. Creativity requires an understanding of the Chinese intellectual property (IP) system both as codified and as practiced.

Protecting the outward appearance of an item can be a fundamental part of an intellectual property portfolio. Too often, available avenues of protection, such as design patents, are ignored by outsiders. As a result, IP portfolios in China may be incomplete and application opportunities may be lost. But design patents aren’t necessarily the only way to protect an object’s outward appearance. Step into the protection of China’s trade dress, an often misunderstood and relatively undeveloped form of protection of the same outward appearance. Understanding the two forms of protection will help companies better protect their intellectual property portfolios in China.

Practice of design patents in China

A “design” is a new conception of shape, pattern or color, and their combination, which creates an aesthetic feeling and is suitable for industrial application by Chinese standards. Patent law. The design patent in China is a popular form of patent protection, at least for Chinese people who file about ten times as many design patent applications in China as foreign applicants. A design patent in China is relatively inexpensive, easy to obtain, and of value. Design patents in China do not undergo extensive scrutiny and are issued quickly, usually within weeks or months. Once granted, they have a lifespan of ten years.

And the design patents in China have endurance. When challenged, the validity rate of Chinese design patents, around 42%, is comparable to that of Chinese invention patents, with validity rates of 46%, and is much better than the validity rate. validity of utility model patents.

One of the reasons why foreign applicants are scarce is the lack of experience with the Chinese intellectual property system. An American practitioner would know that in the United States, patent protection for designs is generally limited to protecting the ornamental aspect of the article, and not necessarily its function. For example, a vehicle fender is usually primarily ornamental and may be protected by a U.S. design patent, whereas a vehicle’s transmission would not, as transmissions are normally fully functional. This is not the case in China, where design patents can cover functional products.

Another major deterrent to seeking design patent protection in China is the perception that Chinese courts will not find an infringement unless the offending item is a virtual photocopy of the design patent itself. Although the courts have historically shown little flexibility in this regard, there is evidence that attitudes are changing. See, for example, Matsushita v. Kingdom, Beijing High Court (2016), and M&G v. Deli, Shanghai Intellectual Property Court (2016), where the similarities between the offending product and the design patent were considered sufficient to find patent infringement without being identical.

Despite all of its strengths, and there are many, the number of new design patent filings has actually slowed down over the past two years relative to the number of utility model and invention patent applications. I mentioned this fact in a presentation to an IP program on China not too long ago. An audience member, a Chinese intellectual property lawyer, explained that the reason was the increased use of trade dress in China to protect the outward appearance of an item. I found this answer curious – I have never considered design patents and trade dress in China to be mutually exclusive. I rather thought that at the very least, they would be complementary. It was then that I realized that commercial clothing itself can be misunderstood, or perhaps simply misunderstood, even by Chinese practitioners.

The trade dress variable

The very trade dress debate in China is particularly complicated by the fact that China does not have the same concept of trade dress as in the United States and, in fact, there is no legal reference to it. trade dress as a form of non-patented design protection.

With its base in the 1985 Patent law, the practice of design patents in China has had the opportunity to develop in terms of prosecution and enforcement over the past 35 years. The same cannot be said for trade dress, however. Many countries, including the United States, India, and Japan, allow trade dress registration under trademark law. For example, trade dress in the United States can be registered based on the Lanham Law. Unregistered trade dress may also be protected in some cases.

China does not provide clear protection for trade dress, which, according to practice, refers to the general appearance of an item, sometimes referred to as “look and feel”. China is not alone in this regard as other countries (including Brazil and South Korea) do not make arrangements for trade dress registration but alternatively provide for application under an unfair competition law. This should not be confused with trademarks, which can be registered in China. (Nike has successfully used a 2D trademark to protect its Converse Chuck Taylor shoe from infringement of the look and feel of the design.) While not providing any specific reference to “commercial clothing,” China Unfair Competition Law has been used to protect the unique overall visual appearance of a product which enjoys a “certain level of reputation”.

In this way, trade dress is similar to protecting a trademark – both are intended to protect the underlying product, but trade dress is intended to protect the visual appearance. However, in China, unlike the United States, trade dress is not treated in the same way as trademark protection and is outside the specific scope of trademarks and other forms of intellectual property protection for products. in China, patents and copyrights.

How to Navigate Business Dress in China

To succeed in an action involving infringement of trade dress, the plaintiff must prove that the look and feel of the item is both well recognized by consumers – the “reputation” factor – and that the counterfeit article therefore creates confusion among customers.

The “fame” requirement is probably the most difficult to achieve. To establish “reputation” and other elements that constitute unfair competition, Chinese courts will consider various factors, including the quality, quantity and cost of advertising and the duration of product sales.

As a key example, the market value of a product was highlighted by the Pudong New Area People’s Court in Shanghai in the New Balance v. New Barlun (China) Co., Ltd. The Pudong court acknowledged that New Balance has invested heavily and continuously in brand advertising. As a result, New Balance was able to demonstrate that its “N” mark constituted “decoration of influential products” prior to the registration of the defendant’s mark.

Perhaps the most well-known recent decision regarding the interpretation of trade dress in China is Land Rover vs. Jiangling dealt with by Chaoyang District Court in 2019. Successfully arguing that the shape of a Land Rover vehicle had gained fame through long-term publicity, the court found that the shape of the vehicle met the requirement of “Decoration … with a certain influence” of the Unfair Competition Law. Jiangling was ordered to stop production of his own vehicle and pay compensation to Land Rover.

It is important to note that the level of “fame” must be demonstrable in China as was the case in all of these cases, and therefore trade dress, by definition, almost certainly excludes new brands. In cases where both items have achieved “famous” status in China (as in Guangdong Jiaduobao Beverage & Food Co., Ltd. v Guangzhou Pharmaceutical Group Co., Ltd), it may be difficult to prove infringement.

Design patent or trade dress or both?

So, are you making a choice in China between a design patent or trade dress to protect the outward appearance of an item? Do you, as the skeptical audience member believed, shy away from design patents these days in favor of trade dress? I asked some of my Chinese colleagues about the strategy of shifting patent protection from designs to trade dress. The majority disagreed with this conclusion, arguing instead that trade dress protection in China at this stage of development should only be invoked as a “safeguard” strategy, which provides additional protection. to a more conventional design patent. However, an article can be simultaneously protected by a design patent and trade dress. In fact, the court can combine the hearings for the alleged design patent infringement and trade dress violations (two separate actions) so that they take place on the same day. Yet trade dress protection, although not yet fully developed in China and while unlikely to provide protection unique to the configuration of an item, has the great advantage of s ” extend beyond the fixed term of protection provided for in a design patent. The truly creative model IP portfolio in China is expected to include both design patents and business presentation among its many components.

Thomas T. Moga ([email protected]) is an attorney for Dykema Gossett and is registered to practice before the United States Patent and Trademark Office. Mr. Moga has lived and worked in China and, as a Fulbright Fellow, has instructed patent examiners at the National Intellectual Property Administration of China. He is a member of the US Department of Commerce’s Intellectual Property Rights Industry Trade Advisory Committee.

Thanks to Ms. Susan Anthony and Mr. Michael Mangelson, both from the USPTO’s Bureau of Policy and International Affairs, and Mr. Gavin Jia, Patent Attorney at NTD Intellectual Property Attorneys, Beijing, China, for their contribution to this article.


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