Design Patents vs. Trade Dress: Protecting Intellectual Property in China

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It is not easy to identify a direct line to a successful IP portfolio in China. There are many variables in the equation, including knowing the gray areas between the lines of the black letter law and the ability to be creative. It is this last variable that often plays the most important role. Creativity requires an understanding of the Chinese intellectual property (IP) system both as it is codified and as it is 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. This is where China’s trade dress protection comes in, an often misunderstood and underdeveloped form of same outward appearance protection. An understanding of both forms of protection will help companies better protect their IP portfolios in China.

China Design Patent Practice

A “design” is any new design of shape, pattern or color, and their combination, which creates an aesthetic feeling and is suitable for industrial application according to China. Patent law. The design patent in China is a popular form of patent protection, at least for the Chinese who file about ten times more design patent applications in China than foreign applicants. A design patent in China is relatively inexpensive, easy to obtain, and valuable. Design patents in China are not thoroughly scrutinized and are granted quickly, usually within weeks or months. Once granted, they have a lifespan of ten years.

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

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

Another significant deterrent to seeking design patent protection in China is the perception that Chinese courts will not find infringement unless the accused item is a virtual photocopy of the design patent itself. Although the courts have historically shown little flexibility in this regard, attitudes seem to be changing. See, for example, Matsushita v. KingdomBeijing High Court (2016), and M&G vs. DeliShanghai Intellectual Property Court (2016), where the similarities between the product in question and the design or model were deemed sufficient to conclude that the patent was infringed without being identical.

For all its strengths, and there are many of them, the number of new design patent filings has actually slowed down over the past couple of years relative to the number of utility model and invention patent filings. I mentioned this fact during a presentation at a China IP program not long ago. One audience member, a Chinese intellectual property lawyer, pointed out that the reason for this was the increased use of trade dress in China to protect an item’s outward appearance. 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 trade dress itself can be misunderstood, or perhaps simply misunderstood, even by Chinese practitioners.

The trade dress variable

The very discussion of trade dress in China is particularly complicated by the fact that China does not have the same concept of trade dress as the United States and, in fact, there is no legal reference to trade dress as a form of non-patent 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. However, the same cannot be said for commercial clothing. Many countries, including the United States, India, and Japan, allow registration of trade dress 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 certain 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 provide for trade dress registration but instead provide for enforcement under a trade dress law. unfair competition. This should not be confused with trademarks, which may be registered in China. (Nike successfully used a 2D trademark to protect its Converse Chuck Taylor shoe from infringing on the look and feel of the design.) Anti-unfair competition law was used to protect the unique overall visual appearance of a product that enjoys a “certain level of reputation”.

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

How to Navigate Commercial Apparel in China

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

The “fame” requirement is probably the most difficult to achieve. To establish “reputation” and other elements constituting unfair competition, Chinese courts will consider a variety of 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 emphasized by the Shanghai Pudong New Area People’s Court in the New Balance v. New Barlun (China) Co., Ltd. The Pudong court recognized that New Balance had invested heavily and continuously in brand advertising. As a result, New Balance was able to demonstrate that its “N” mark constituted an “influential decoration of products” before the registration of the defendant’s mark.

Perhaps the most well-known recent decision interpreting trade dress in China is Land Rover vs. Jiangling processed by the Chaoyang District Court in 2019. Successfully arguing that the shape of a Land Rover vehicle had gained fame through long-term publicity, the court concluded that the shape of the vehicle met the requirement of “decoration…with some influence” from Anti-unfair competition law. Jiangling was ordered to stop production of its own vehicle and pay compensation to Land Rover.

Above all, the level of “fame” must be demonstrable in China as was the case in all of these cases, and so 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. vs. Guangzhou Pharmaceutical Group Co., Ltd)it can be difficult to prove infringement.

Design patent or trade dress or both?

So, do you make a choice in China between a design patent or a trade dress to protect the outer appearance of an item? Do you, as the skeptical audience member believed, eschew design patents in favor of trade dress these days? I asked some of my Chinese colleagues about the strategy of passing design patent protection in favor of trade dress. The majority disagreed with this conclusion, arguing instead that the protection of trade dress in China at this stage of development should only be invoked as a “safeguard” strategy, one that offers complementary protection. to a more conventional design patent. However, an article can be simultaneously protected by both a design patent and a trade dress. In fact, the court can combine hearings for alleged design patent infringement and trade dress violations (two separate actions) to be held on the same day. Yet trade dress protection, although not yet fully developed in China and unlikely to provide exclusive protection to an item’s configuration, has the great advantage of being extend beyond the term of protection set out in a design patent. The truly creative model IP portfolio in China should include both design patents and trade dress among its many components.

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

Thanks to Ms. Susan Anthony and Mr. Michael Mangelson, both of the Office of Politics and International Affairs, USPTO, and Mr. Gavin Jia, patent attorney at NTD Intellectual Property Attorneys, Beijing, China, for their contributions to this article.

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