Trademark Infringement in Business Cooperation Leads to Compensation of 500,000 Yuan!
In the daily business operations of enterprises, commercial cooperation is an essential part of driving development. However, in recent years, trademark infringement caused by business cooperation has become a common phenomenon.
Recently, the High People's Court of Fujian Province concluded a case where a business cooperation between two parties led to a trademark infringement lawsuit due to the excessive use of the trademark beyond the scope of the cooperation.
Case Background:
Kaplan Global is an educational institution, and its brands such as Kaplan Education, Kaplan Study Abroad, Kaplan Study Tours, and Kaplan Academy have gained a certain level of market recognition. In July 2018, Kaplan Global acquired the "Kaplan Education" trademark and its design through assignment, becoming the holder of the trademark.
In 2020, Kaplan Company reached a recruitment representative cooperation with Xu, an employee of a peer company, Yifei, which is engaged in educational training. The agreement stipulated that Xu would select students with intentions to study abroad from the many students in the training programs and recommend them to Guangdong Kaplan Company, which would provide recruitment and promotional materials for study abroad programs.
In 2021, Kaplan Company discovered that Yifei Company had used an identical mark to "Kaplan Education" in its "Yifei Foreign Language Student Enrollment Agreement" with its students, in external promotional materials, interior decorations, and on the business cards of its staff.
Kaplan Company then sued Yifei Company for trademark infringement at the Intermediate People's Court of Fuzhou City, Fujian Province, demanding that the defendant immediately cease the infringing activities and compensate for economic losses, totaling over 1.18 million yuan.
During the trial, Kaplan Company stated that its cooperation with Xu, an employee of Yifei Company, was a collaboration between individuals and did not represent a cooperation with Yifei Company. Moreover, it had not authorized Xu to use the involved trademark for commercial activities. Therefore, Yifei Company's actions infringed upon the exclusive right to use the registered trademark.
However, the defendant, Yifei Company, argued that it had a cooperative relationship with the plaintiff company, and the use of the trademark in the student enrollment agreement was a legitimate and normal use permitted by the plaintiff company. During the cooperation, to facilitate promotion, the Fuzhou branch of the plaintiff company had sent the involved trademark to Yifei Company and actively requested the defendant company to use the trademark to create an impression of a harmonious cooperation between the two parties.
Therefore, the defendant company claimed that its actions did not constitute trademark infringement.
Court's View:
After reviewing the evidence submitted by both parties, the Fuzhou Intermediate Court held that:
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Although Xu, an employee of the defendant company, presented chat records of cooperation with the plaintiff company, which mentioned the use of the "Kaplan Education" trademark, there was no evidence to show that the plaintiff company had authorized the use of the involved trademark. Thus, it could not be concluded that the plaintiff company had generally authorized Yifei Company to use the involved trademark.
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The defendant company also argued that the cooperation between Xu and the plaintiff company, and the provision of recruitment materials for Kaplan Education to Xu by the plaintiff company, were acts in fulfillment of the contract and did not constitute trademark infringement. However, the cooperation between the plaintiff company and Xu as an individual did not mean that the defendant company had thereby obtained the right to use the plaintiff company's involved trademark at will.
In summary, the defendant company used the involved trademark in its foreign language training premises and business activities without the permission of the plaintiff company, exceeding the scope of the agreed commercial cooperation. This indeed infringed upon the plaintiff company's exclusive right to use the registered trademark.
Therefore, the court ruled that the defendant company should immediately cease the infringing activities, publish a statement to eliminate the impact, and compensate the plaintiff company for economic losses, totaling 500,000 yuan.
After the first-instance judgment, Yifei Company appealed to the High People's Court of Fujian Province. The High Court reviewed the case and dismissed all the appeal requests of Yifei Company, upholding the first-instance judgment.
Summary:
Commercial cooperation in the business operations of enterprises is an indispensable stage for corporate development. However, it is not acceptable to use the guise of "cooperation" to commit trademark infringement.
If one attempts to use the appearance of a commercial cooperation to unreasonably use the other party's trademark to "hitch a ride," causing consumers to be confused about the source of the service or to mistakenly believe that there is an affiliation between the two parties, it will constitute trademark infringement.
