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Analysis of trademark law that promises sales

author:Anye Enterprise Service

Looking at the entire content of the Trademark Law of the People's Republic of China (hereinafter referred to as the Trademark Law), there is no explicit provision for the promise of sales. Article 11 of the Patent Law of the People's Republic of China (hereinafter referred to as the Patent Law) stipulates that an act of promising the sale of a patented product for the purpose of production and operation or a product directly obtained in accordance with the patented process without the permission of the patentee is an act of infringement of the patent right. Judging from the existing cases, the court found that the promise of sale was a trademark infringement in the dispute between Anji Food (Hong Kong) Co., Ltd. and Zhao Wenwu for infringement of the exclusive right to use a registered trademark, and directly ordered the defendant to stop selling the goods marked with relevant marks in the main text of the judgment. 1. However, in practice, there are still differences of understanding as to whether the act of promising sales carried out without the permission of the trademark owner infringes the trademark right and how to define the nature of the act.

  First, two views on promising sales

  One view is that, as two important branches of intellectual property law, the standards of trademark law and patent law on infringement issues should be consistent. Although the Trademark Law does not directly stipulate that the act of promising sales is an act of infringement of trademark rights as the Patent Law, the act of promising sales without the permission of the trademark owner should be treated as an act of infringement with reference to the provisions of the Patent Law. Similarly, there is a similar view on the issue of whether an import act carried out without the permission of the trademark owner is infringing, that is, considering that the Patent Law has stipulated that an import act carried out without permission for the purpose of production and operation is an infringing act, based on the same interpretation rules, such import acts carried out without the permission of the trademark owner should also be regarded as acts of infringement of the trademark right, and cannot be excluded from the scope of infringement because the Trademark Law does not clearly stipulate it. 2

  Another view is that the issue of trademark law should still start from the principles and rules of the trademark law, and the provisions of the Patent Law cannot be simply applied, and because the Patent Law stipulates that the promise of sale is an act of infringement, it cannot be directly determined that the act of promising sales without the permission of the trademark owner is also an act of infringement of the trademark right. Although the Trademark Law does not make clear provisions on the act of promising sales, the Trademark Law has made relatively comprehensive provisions on the protection of trademark rights, and according to the specific content of the act, the nature of the promised sale act can be accurately positioned in the Trademark Law. In many cases, a promise of sale without the permission of the trademark owner is sufficient to be considered an act of trademark infringement. However, in defining the nature of the infringement, it cannot be determined as an infringement of trademark rights solely on the grounds that it is "promised to sell" without permission, but should be classified into the existing types of infringement in the Trademark Law.

  I agree with the second view. Although it is not appropriate to directly reject the conclusion of the first view on the grounds that the two laws are independent of each other and cannot be directly applied to the Trademark Law, it can be seen from examining the provisions of the Patent Law on the promise of sales that the Patent Law stipulates that the promise of sales is an act of infringement, the purpose of which is to "stop illegal commercial transactions on the patented product as soon as possible and prevent the spread of patented products manufactured and imported without permission"3, but because the Patent Law has a clear definition of manufacturing, use, sales, etc., Therefore, the Patent Law juxtaposes the three acts of offering to sell with manufacturing, using, selling and importing as one of the acts that separately constitute infringement of patent rights, and its establishment does not depend on the perpetrator committing other infringing acts at the same time or subsequently. Although the Trademark Law emphasizes the use of trademarks without the permission of the trademark owner and the sale of goods infringing trademark rights, since Article 48 of the Trademark Law has clearly stipulated that "the use of trademarks referred to in this Law refers to the use of trademarks for goods, packaging or containers of goods, and goods trading documents, or the use of trademarks in advertising, exhibitions and other commercial activities to identify the source of goods", Where the promise of sale is already covered by the use of a trademark in the Trademark Law, the legislative purpose of the Patent Law stipulating that the sale is an independent type of patent infringement is fully achievable under the framework of the Trademark Law, and it is obviously no longer necessary to add an independent type of infringement.

  Second, the promise of sales in the network environment

  Although through the above analysis, there can be a general understanding of the nature of the promised sales behavior, but because the network environment has its own characteristics, when the promised sales behavior is combined with the computer network, some of the originally clear problems will become blurred. Therefore, this paper analyzes the nature of related behaviors in conjunction with the network environment.

  If a market operator sells goods on its website that it has trademark rights, it will certainly not touch on the question of whether the promise of sale discussed in this article is infringing. The question to be discussed is whether a business operator infringes on another person's trademark right when displaying or promoting a product on the website that others have trademark rights but does not actually sell the goods. Where the business operator obtains the authorization of the trademark owner, the relevant acts certainly do not involve infringement. However, if a business operator uses the trademark owner's trademark on its website to engage in a promising sale without the permission of the trademark owner, does the trademark owner have the right to stop it and require the business operator to bear the corresponding infringement liability?

  In the case of Beijing Aerospace Caissa International Investment Management Co., Ltd. v. Jilin Changyuan Pipe Industry Co., Ltd. over trademark infringement and unfair competition, the defendant used the plaintiff's trademark on its website to display and publicize the relevant approved goods on its website without the permission of the plaintiff as the trademark owner, but the defendant never actually sold the goods using the plaintiff's trademark. In response to the plaintiff's claim that the defendant stop producing, selling, and publicizing the infringing products and compensate for the losses, the court of first instance held that the defendant's use of the same trademark as the plaintiff's registered trademark on the goods produced and sold by the plaintiff on the website it operated constituted an infringement of the plaintiff's exclusive right to use the registered trademark. Therefore, in the event that the defendant had deleted the relevant content of the webpage and the plaintiff had withdrawn its claim to stop the infringement, the court of first instance ordered the defendant to compensate the plaintiff for economic losses of RMB50,000 in accordance with article 57 (1) of the Trademark Law. 4 However, the court of second instance held that, according to the plaintiff's litigation claim, because the defendant did not engage in the manufacture of the goods involved in the case, the plaintiff's allegation that the defendant had carried out the production of the allegedly infringing goods could not be established, and the defendant did not violate the provisions of Article 57(1) of the Trademark Law. The premise of selling goods that infringe the exclusive right to use a registered trademark is that the goods are goods that infringe the exclusive right to use a registered trademark of another person. In this case, the defendant only promised to sell but did not actually sell the relevant goods, and as far as its promise to sell, it should include two situations: one is that the goods sold by the plaintiff or authorized by the plaintiff are obviously not acts of infringement of the plaintiff's trademark rights; In view of this situation, the plaintiff should prove that the goods sold are unauthorized infringing goods, but since the sale has not actually occurred and the plaintiff has no way to prove it, it cannot be determined that the goods promised to be sold on its website are goods that infringe the plaintiff's exclusive right to use the registered trademark, and the defendant's behavior is of course not an infringement under Article 57 (3) of the Trademark Law. Accordingly, the court of second instance revoked the first-instance judgment and changed the judgment to reject all of the plaintiff's claims.

  Analyzing the above-mentioned argumentation process of the courts of first and second instance, it is not difficult to find that the reason why the court of first instance found that the defendant was infringing was that it believed that the defendant's conduct belonged to the infringement of using the same trademark of others on the same goods without permission as provided for in Article 57 (1) of the Trademark Law. Although the court of second instance introduced the concept of promising sales and held that the defendant's conduct was not the act of selling goods that infringed on the exclusive right to use a registered trademark of another person as stipulated in article 57(3) of the Trademark Law, it ignored a very important issue in the course of this discussion, that is, in addition to the act of using the trademark logo on the physical object of the goods is an act of trademark use, the acts of advertising, exhibition, etc. provided for in Article 48 of the Trademark Law should also be regarded as the use of trademarks. Proceeding from the principle of "consistency of litigation and trial", the court shall respond to the plaintiff's claim for compensation for losses in connection with the defendant's publicity act. Therefore, in the process of handling the case, it is still necessary to pay attention to not being affected by the appearance of promise sales and ignoring the fundamental attributes of the behavior.

  In summary, if the trademark owner uses its trademark on the website to engage in the promised sale without the permission of the trademark owner, the trademark owner has the right to file a lawsuit in accordance with the provisions of Article 48 and Article 57 (1) of the Trademark Law, and claim damages under the circumstances prescribed by law.

  It may not be easy to understand simply that an unauthorized promise of sale infringes upon the exclusive right to use a registered trademark of another person, but if you consider the relevant theories 6 and 7 of "pre-sale confusion", the relevant conclusions may be more acceptable. This is particularly important in the network environment, because the virtual environment of the network makes it difficult for the relevant public to immerse themselves in the authenticity of the promised sales behavior such as advertising and publicity, if others are allowed to use other people's trademarks on the website for advertising and publicity without actually selling the trademark owner's goods, the essence of their behavior is to borrow the goodwill of others to gain a competitive advantage in the market, which will greatly damage the legitimate rights and interests of the trademark owner. Previously, the court treated the other person's registered trademark as an act of unfair competition rather than as a trademark infringement act, mainly because the trademark mark was used inside a computer system and was not directly displayed to the public as a commercial sign, so it was not treated as a trademark use. 8 However, on the one hand, the special relationship between the Anti-Unfair Competition Law and the Trademark Law determines that those solidified acts of unfair competition can be fully incorporated into the framework of the Trademark Law and treated in a typed manner; on the other hand, the scope of "other commercial activities" in Article 48 of the Trademark Law is also very broad, and the purchase of bidding ranking keywords can be regulated as the above-mentioned commercial activities, so with the development of practice, It is possible and should be recognized as trademark infringement by using another person's registered trademark as a search keyword for bidding rankings. The latest judicial practice has indeed led to the emergence of cases in which this view has been adopted9, and its rationale is basically consistent with the issue of promise sales.

  Of course, it should also be emphasized here that not all the promised sales acts in the form of advertising and exhibition constitute trademark infringement, and if the actor actually finally sells the goods of the trademark owner or the goods authorized by the trademark owner, the corresponding promise of sales should be treated as a preparatory part of the actual sales act in nature, and the promised sales act should also be absorbed by the subsequent sales act. Even if the seller's sales are not authorized by the trademark owner, if the goods sold are indeed sourced from the trademark owner or the subject of the sale authorized by the trademark owner, based on the principle of exhaustion of trademark rights, the corresponding sales acts and promising sales acts of the actors should not be found to be infringing acts.

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