On August 14, 2019, Pudong New District Court in Shanghai rendered a judgment, ruling in favor of a local business Shanghai Ant’s Power Investment Ltd., who filed a petition for declaration of non-infringement against the hotel magnet Marriott Worldwide Corporation (Marriott). The Court affirmed that the Plaintiff’s act does not constitute trademark infringement and ordered Marriott to pay RMB 150,000 to indemnify plaintiff for its legal costs.

This declaratory lawsuit was triggered by a cease & desist letter, in which Marriott demanded Shanghai Ant’s Power to withdraw the alleged infringing trademark application and stop using trademarks incorporating the “AC” element which was the distinctive part of Marriott’s prior trademarks.

Court held that Marriott’s claims in the cease & desist letter were clear and specific, which constituted an infringement warning to the Plaintiff. While Marriott neither withdrew the letter nor filed an infringement lawsuit, it cast uncertainty over the Plaintiff’s business operation. Although Marriott filed an opposition action against the Plaintiff’s trademark application, yet it still failed to take action against the alleged trademark use. Therefore, the Plaintiff was entitled to file this lawsuit requesting a declaration of non-infringement.

Contributed by Xia Huan