Moutai Brewery Faces Trademark Infringement Again, Wins Appeal with Compensation of 500,000 Yuan!
Moutai wine is a household name in China, renowned for its exceptional quality, long history, unique brewing process, and extensive social influence. It is often referred to as China’s “national liquor.”
The “Moutai” trademark is held by Moutai Group. However, Moutai Group owns not only the “Moutai” trademark but also many other well-known brands, including “Xijiu.”
The “Xijiu” trademark belongs to Moutai (Group) Xijiu Co., Ltd., a wholly-owned subsidiary of Moutai Group. The accused infringing trademark, “Xixiju,” is held by Guizhou Feitianwuxing Wine Co., Ltd.
According to the Guangzhou Sailixun Litigation Strategy Database, the trademark held by Feitianwuxing Wine Company was originally “Xixiju.” After Xijiu Company filed a trademark invalidation declaration, it was changed to “Xixiju.”
Cause of the Incident
In 2018, the Yunyan District Market Supervision and Administration Bureau of Guiyang City seized 197 cases of “Xixiju” Chinese Dream liquor from the warehouse of Lida Hezhong Company. This led to the initiation of the trademark infringement lawsuit.
Xijiu Company sued Feitianwuxing Wine Company and Lida Hezhong Logistics Company, demanding that the defendants immediately cease the infringing activities and compensate the plaintiff for economic losses of 1 million yuan.
First Trial Loss
The Intermediate People’s Court of Guiyang City reviewed the case. During the trial, after comparison in court, the court found that:
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The trademark “Xixiju” used on the allegedly infringing products is significantly different from the registered trademark in overall appearance when compared in isolation.
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Although the character “Xi” in the allegedly infringing trademark has the same pronunciation as the character “Xí” in Xijiu Company’s registered trademark, they have different fonts. Moreover, the character “Xi” in “Xixiju” does not form a separate meaning. The two trademarks are not similar in terms of character composition, pronunciation, meaning, and overall visual effect.
Therefore, even considering the high reputation of Xijiu Company’s registered trademark, the relevant public can still distinguish between the allegedly infringing trademark and Xijiu Company’s registered trademark. There is no likelihood of confusion or misidentification regarding the source of the goods.
Based on the above, the court ruled that the defendant did not infringe the plaintiff’s registered trademark rights and dismissed the plaintiff’s claims.
After the judgment, Xijiu Company appealed to the High People’s Court of Guizhou Province.
Second Trial Victory
During the appeal, the court identified the key issue as whether the use of the “Xixiju” trademark on the involved liquor products infringed upon the plaintiff’s registered trademark rights.
The appellate court concluded that:
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Feitianwuxing Company prominently used the “Xixiju” trademark on the packaging boxes, wine boxes, and handbags of the liquor it produced and sold. Additionally, the company promoted and sold “Xixiju” Chinese Dream liquor on its official website. The “Xixiju” trademark served to identify the source of the goods, constituting a trademark use.
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Xijiu Company’s “Xijiu and Figure” trademark has been recognized as a well-known trademark, with strong distinctiveness and high reputation. When the relevant public sees the “Xijiu and Figure” or “Xí” trademark or hears its pronunciation, they usually associate it with Xijiu Company’s liquor products and brand. This is sufficient to cause confusion among the relevant public in the liquor market, leading them to mistake the “Xixiju” liquor, which contains the similar text “Xijiu” or “Xí,” for Xijiu Company’s series of liquor products.
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It was also found that Feitianwuxing Company and the plaintiff are both located in Maotai Town, Renhuai City, Guizhou Province, and belong to the same industry. Feitianwuxing Company should have been aware of the reputation of Xijiu Company and its registered trademark. The subjective intent to infringe is evident.
In conclusion, the High People’s Court of Guizhou Province overturned the first-instance judgment and ruled that Feitianwuxing Company should immediately cease the infringing activities and compensate the plaintiff for economic losses of 500,000 yuan.
Conclusion
From the loss in the first trial to the victory in the second trial with a compensation of 500,000 yuan, it is clear that the focus of the dispute and the basis for the judges’ decisions lie in whether the contested trademark would cause consumer confusion.
In such trademark infringement cases, having strong consumer survey reports as supplementary evidence to clarify whether confusion is likely to occur would be crucial.
