Recently, the Higher People's Court of Fujian Province delivered a second-instance judgment on the trademark infringement and unfair competition dispute where Jomoo Sanitary Ware Co., Ltd. sued Guangdong Jomoo Home Furnishing Co., Ltd., its foundries and several other defendants. The court held that Guangdong Jomoo Home Furnishing Co., Ltd. and other defendants had infringed upon the exclusive right to use the registered trademark by adopting identical or similar marks such as "Jomoo" to the No.4044548 "JOMOO" trademark of Jomoo Sanitary Ware Co., Ltd. in the production and sale of sanitary ware products including faucets, showers and gas stoves, and their acts also violated the relevant provisions of the Anti-Unfair Competition Law.
Accordingly, the Higher People's Court of Fujian Province ordered all defendants to immediately cease the infringing acts, ordered Guangdong Jomoo Home Furnishing Co., Ltd. to compensate Jomoo Sanitary Ware Co., Ltd. a total of 6 million yuan for economic losses and reasonable expenses, and ruled that the other defendants bear corresponding joint and several liability for compensation.
The second instance upheld the original first-instance judgment.
Two "Jomoo" Entities in Court
Founded in 1990, Jomoo Sanitary Ware Co., Ltd. is a comprehensive enterprise focusing on integrated sanitary ware solutions, with businesses covering R&D, manufacturing, sales and services. Through long-term brand operation and market promotion, "JOMOO" has become a well-known sanitary ware brand in the industry, winning numerous industry awards. The involved trademark has been recognized as a well-known trademark in multiple administrative and judicial proceedings.
Through market monitoring, Jomoo Sanitary Ware Co., Ltd. found that Guangdong Jomoo Home Furnishing Co., Ltd. not only used the alleged infringing marks on the faucets, showers, gas stoves and other products it produced and sold, but also prominently used the "Jomoo Home Furnishing" mark in its exclusive stores, franchised stores, official website, WeChat official accounts and corporate promotional videos.
On October 10, 2023, Jomoo Sanitary Ware Co., Ltd. filed a lawsuit with the Quanzhou Intermediate People's Court of Fujian Province, naming Guangdong Jomoo Home Furnishing Co., Ltd. and its person-in-charges Xiao Moulai and Xiao Mouli as defendants, and later added several foundries and sellers as co-defendants.
Guangdong Jomoo Home Furnishing Co., Ltd. argued that other courts had previously dismissed the lawsuit by ruling due to procedural irregularities in respect of the relevant facts, and that the joint trial of this case by the Quanzhou Intermediate People's Court under such circumstances did not meet the constitutive elements of a necessary joint litigation. It claimed that the rights and obligations of each defendant were independent, the causes of action were different, and the case should be heard in separate trials. At the same time, it alleged that Jomoo Sanitary Ware Co., Ltd. had abused its rights by filing this lawsuit, intending to eliminate competitors through judicial means.
Some foundries and sellers also argued that there was no basis for a joint trial of the case, that their acts were based on legitimate authorization, and that they had performed their duty of reasonable inspection, thus not constituting infringement.
Severe Punishment for Malicious Infringement
After trial, the Quanzhou Intermediate People's Court conducted a review focusing on the key issues such as whether the case constituted a joint litigation and whether the alleged acts constituted infringement.
Regarding the joint litigation, the court held that the lawsuits against the manufacturers and sellers all took the infringement of the involved trademark right and the constitution of unfair competition as the cause of action. A joint trial was conducive to improving trial efficiency and avoiding conflicting judgments, which was legal and reasonable.
Regarding the infringement, the court pointed out:
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The involved trademark has been recognized as a well-known trademark for many times and has established a stable corresponding relationship with Jomoo Sanitary Ware Co., Ltd. Guangdong Jomoo Home Furnishing Co., Ltd.'s use of similar marks on the alleged infringing products and in its promotions is likely to cause the public to confuse the source of the goods and weaken the relevance between the involved trademark and Jomoo Sanitary Ware Co., Ltd., constituting trademark infringement and unfair competition.
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As operators in the same industry, the relevant foundries should have been aware of the popularity of Jomoo Sanitary Ware Co., Ltd.'s trade name. They still commissioned the production of infringing products with the subjective intent to free-ride on the goodwill of Jomoo, and should bear joint tort liability with the brand owner.
Accordingly, the Quanzhou Intermediate People's Court rendered a first-instance judgment, ordering Guangdong Jomoo Home Furnishing Co., Ltd. to compensate Jomoo Sanitary Ware Co., Ltd. 5 million yuan for trademark infringement losses and 1 million yuan for unfair competition losses, and ruling that the relevant foundries and sellers bear joint and several liability within their respective liability limits.
After the first-instance judgment was pronounced, Guangdong Jomoo Home Furnishing Co., Ltd. and some foundries filed an appeal.
During the second instance, as Guangdong Jomoo Home Furnishing Co., Ltd. failed to pay the appeal fee in accordance with the law, the Higher People's Court of Fujian Province ruled to treat the appeal as withdrawn and upheld the original judgment in the final judgment.
Demonstrating the Crackdown on Infringement
Given the high popularity of the involved trademark, the long chain and wide geographical scope of the infringing acts, and the case involving both trademark infringement and unfair competition legal relations, this case has attracted wide attention from the industry.
The presiding judge of the second instance pointed out that this case has two typical significances:
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The defendants had an obvious intent to infringe, and their acts covered multiple online and offline links in an all-round way. The court applied the statutory maximum of compensation in accordance with the law, demonstrating the judicial attitude of cracking down on malicious infringement.
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Faced with the situation where the actual controller attempted to evade liability through equity transfer, the collegial panel, being unable to apply the disregard of corporate personality system, brought the actual controller into the subject of liability from the perspective of joint tort, forming an effective deterrence against acts of evading enforcement.
The second-instance judgment establishes important judicial guidance at three levels:
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In terms of right protection, it strengthens the legal protection of well-known trademarks and clarifies the forbidden zone for free-riding acts.
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In terms of liability allocation, it clarifies the liability boundaries of brand owners, manufacturers and sellers, promoting the compliant development of the industrial chain.
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In terms of compensation standards, the heavy damages award reflects the zero tolerance for large-scale and malicious infringement acts, exerts the dual functions of punishment and deterrence, and highlights the value orientation of strict intellectual property protection.
