The classic answer to this question is: it depends on whether such use is "fair use" or not. When products are sold online, the answer can be a little trickier. Sellers tend to use long descriptions of their products by inserting many "key words" in the product title, so as to trigger online searches and attract buyers. Where some of these key words are registered trademarks that belong to a third party, who did not give its consent, the issue of trademark infringement arises.

Recently, in 2018 and in 2019, two cases issued by the Chinese courts, involving two famous mobile phone manufacturers (Xiaomi and Oppo), illustrate this problem.

Xiaomi Case [(2018) Zhe 03 Min Zhong No. 6047]

Xiaomi Technology Co., Ltd. (Xiaomi) sued Rui’an Baorui E-Commerce Co., Ltd. (Baorui) before the Intermediate People's Court of Wenzhou, for infringement of its registered trademark Xiaomi. Baorui was selling two types of portable batteries used for mobile phones. One was called "Ultra-thin mini power bank 1W mA 80000 Apple X universal Xiaomi portable battery 20000" and the other "Ultra-thin battery 20000 mA Apple X portable high-capacity battery Xiaomi mobile line only". The court determined that the first use constituted trademark infringement, while the second use was "fair use".

For the first abovementioned product, Baorui Company used the word "Xiaomi" and connected it with the word "portable battery", making it easy for the relevant public to believe that the portable battery sold under this title was produced by Xiaomi. The word "Xiaomi" here played the function of identifying the source of the product, which was determined as trademark use and constituted trademark infringement.

For the second product, Baorui used together the words "Xiaomi mobile", which was meant to explain to consumers that the portable battery is compatible with Xiaomi mobile phones. Since the alleged infringing product can indeed be applied to Xiaomi mobile phones, Apple mobile phones, etc., the word "Xiaomi" here had objectively a descriptive intention, which did not function as use of a trademark for the purpose of identifying the source of the product. Therefore, this did not constitute trademark Infringement.

OPPO case [(2019) Zhe 01 Min Zhong No. 9115]

Oppo company sued Ouzhige Company (Ouzhige) before the Hangzhou Intermediate People's Court for the infringement of its registered trademark OPPO. Ouzhige was selling headphones using the following sequence of key words: “Yingjuren applicable OPPO wired headphone in-ear R15R11splusA5A1R9sA3A59s original authentic vivo Apple universal female bass mobile phone earplug male”.  The name of the product was displayed as “HALFSun / Yingjuren applicable OPPO", and more specifically, the model involved was called "applicable OPPO headphone in-ear R15R11s". The Hangzhou Intermediate People’s Court determined that such use neither constituted trademark infringement nor unfair competition.

Regarding trademark infringement, the court held that Ouzhige Company’s use of the trademark OPPO, in the name of the product and in the introduction of its commercial activities, had the appearance of trademark use, but that it should still be necessary to judge whether such use, subjectively or objectively, had the effect of identifying the source of the goods. The court found that the purpose of Ouzhige was to indicate the characteristics of the product, i.e., that the headphone involved was applicable to OPPO products. As Ouzhige was using its own brand "Yingjuren" and the words "applicable OPPO", the use of the word OPPO in relation to the headphones did not cause consumers to mistakenly believe that the headphones were OPPO product. Furthermore, in the full product title, there was a clear reference to another brand of products, Vivo. Therefore, the use of OPPO by Ouzhige did not function as a source identifier and did not constitute trademark infringement.

The case was also based on unfair competition. In that regard, the court held that unfair competition implies a malicious intention of unfair competition. In this case, Ouzhige clearly indicated that its headphone sold under the Yingjuren brand were applicable to electronical products such as OPPO, Vivo, etc., which was confirmed in its chat record with OPPO. Ouzhige did not claim that its product were OPPO products nor had a certain connection with OPPO. Therefore, Ouzhige did not have the subjective intention of free-riding on the goodwill of OPPO and its acts did not constitute unfair competition.

Comments

From the above two cases, it can be concluded that the title of a product sold online is an important factor for facilitating consumers’ search and attracting consumers to the seller’s store and is also a key way for the seller to show the source of the goods to consumers, like advertisement or transaction document in an offline physical store. Whether the use of a trademark in the product title constitutes trademark infringement depends on whether it actually plays the role of identifying the source of the product and whether it causes consumers to misrecognize the source of the product.

As pointed out in Article 3 of “Criteria for Judging Trademark Infringement” published by the China Intellectual Property Administration (CNIPA), which just came into effect on June 17, 2020, “To judge whether (the use of a trademark) constitutes trademark infringement, it is generally necessary to judge whether the alleged infringement constitutes trademark use in the sense of the trademark law. The trademark use refers to using trademark on commodities, commodity packages, containers, service venues and transaction documents or in advertising, exhibitions and other commercial activities in order to identify the source of goods or services."

Correspondingly, to establish the defense of fair use, the trademark user needs to prove that the use does not cause the relevant public to be confused about the source of the goods.

In its draft of the abovementioned “Criteria for Judging Trademark Infringement” (article 39), the CNIPA had provided detailed illustrations of fair use, such as (1) using a mark to indicate the generic name, shape or model, the quality, main raw materials, functions, uses, weight, quantity and other features of the goods/services or to mark the production place of the goods/services, which does not cause misrecognition by the relevant public; (2) using a trademark in good faith and reasonably, to objectively indicate the source, use, service objects and other characteristics of the goods/services and their relation to the goods/services of others, which does not cause misrecognition by the relevant public. Although the content of this article was not maintained in the final version, it can still be used as a reference in practice.

Contributed by: Binbin Du