After 30 of President Donald Trump’s trademarks in China were approved in March 2017, his daughter Ivanka’s trademarks in China were approved in April. Similar to President Trump’s situation, where he received the good news after backing down from the China-Taiwan policy, Ivanka received the approval the very day she dined with China’s president in Florida. Other than political implications and special-treatment speculation, what should be the real issue that would impact Western brands in China? Has China toughened up its law to protect public figures against trademark squatters?

Ivanka’s Trademarks in China

Background

Unlike President Trump, who filed trademarks in China in his own name, Ivanka Trump filed trademarks under her company name: Ivanka Trump Marks LLC.

The Ivanka company has filed more than 50 trademark applications in China since 2008. Not surprisingly, most of them were filed in 2016 during her father’s presidential campaign. The 2016 filings are the ones getting the media’s attention, so let’s narrow this discussion to only those applications.

On May 17, 2016, the Ivanka company filed 25 trademark applications in China. These marks cover seven international classes: Class 3 (cosmetics), Class 9 (electronic device), Class 14 (jewelry), Class 18 (handbags), Class 25 (clothing & accessories), Class 35 (advertising & promotional services) and Class 44 (beauty & spa services).

On April 6, 2017, three of the 25 applications were approved — as outlined in the chart below. The timing is very interesting: It was the very day Ivanka Trump dined with China’s president.

 

Political Influence or Pure Coincidence?

On the surface, everything did appear to comply with China’s trademark law.

China’s trademark law mandates a nine-month timeline to complete examination of a trademark application. This strict timeline is necessary especially considering the exponential increase of trademark filings in China each year (for example, 3.69 million applications in 2016 alone) and a brand is essentially vulnerable to infringement risk at any time without the protection of a registration (China does not recognize use/common law rights).

It took roughly 11 months for the Ivanka company’s trademarks to be approved — this is in compliance with China’s nine-month rule.

In fact, not all of the company’s marks have been approved. Out of the 25 applications, 16 remain pending, and six have been refused. The approval rate is around 12 percent — i.e., about the same percentage of the average trademark approval rate in China.

The above two points echo the Chinese government’s statement that no special treatment was granted to the Trump family’s trademarks. However, should an “average Joe” expect an 11-month approval time? Probably not. As analyzed in my prior article about President Trump’s marks in China, the Trump marks have encountered less hurdles during the examination process because of their fame in China. For the average Joe without fame recognition in China, a 12-month or more prosecution timeline is a more realistic expectation.

Fake “Ivanka” Marks in China

The focus on President Trump’s or Ivanka Trump’s trademarks in China should not center around political speculation alone. Other than scratching the surface and checking on the procedural rules, we will never know the true answer. The real issue should be: Is China more equipped now to protect the trademark rights of public figures than before?

China is notorious for its robust (and lucrative) infringement industry. It is in fact a form of flattery of a brand’s popularity in China if it starts seeing an influx of copycats and infringing trademarks. There is no exception with the Ivanka Trump brand.

A quick search of China’s database shows there are over 250 trademark applications for the “Ivanka” in Chinese marks (“伊万卡”) and 100-plus “Ivanka” English marks. Most of them were filed around November 2016, when the Trump family’s popularity surged during the presidential campaign. Some of the “creative” ones are listed below:

  • A Chinese individual sought to register “Ivanka” for baby diapers, and sanitary towel products.
  • A Beijing company sought to register “Ivanka” for toilets.
  • A Chinese investment company sought to register “Ivanka Trump” for condoms.

All of the above trademarks are pending.

China’s New Tools to Help Public Figures Fight Against Trademark Squatters

So — is China more equipped now to protect the trademark rights of public figures such as Ivanka Trump? The answer is yes. China’s Supreme Court and the Beijing IP Court have exciting new tools to share.

Firstly: The first and primary tool came from the Michael Jordan case decided by China’s Supreme Court in December 2016. The case was recently selected by the Chinese authorities as one of the top 10 intellectual property cases in 2016; it is now the guiding case to help public figures fight against trademark squatters and infringers.

Takeaways from the Michael Jordan case? Even without a senior trademark registration, a public figure can still win against trademark squatters based on its “personal name” rights. This is by no means a pass for public figures or that China is ready to throw away its golden first-to-file system. A tremendous amount of evidence is still required to prove the close relationship between the name and the public figure. However, this shows China’s flexibility and willingness to lend a hand to global brands’ enforcement efforts.

The above takeaway was reaffirmed by China’s Supreme Court in its January 2017 interpretation report. Since the Supreme Court has said it twice; it is now the official rule of the land.

Secondly: The second tool came from the “other negative effect” clause discussed under China’s judicial interpretation in 2017. This is the very clause on which the China Trademark Office has relied to refuse infringing marks copying public figures’ names such as Obama’s Chinese name.

Thirdly: The third tool came from the “good faith” principle which was incorporated in the recent amendment to China’s trademark law. This principle however has been the subject of ridicule and an example of China’s empty promise until April 24, 2017.

In April 2017, in an effort to illustrate what is not a good faith trademark, the Beijing IP Court published 18 examples. Example No. 18 is a specific ban on marks that seek to register “names of the public figures.” A clear message from the Beijing courts that this type of marks will not be tolerated.

The Chinese infringers always have a strong interest in registering famous Western people’s names as trademarks — for example, names of the political figures (“Obama”; “Donald Trump”), pop stars (“Lady Gaga”; “Britney Spears”), sports giants (“Michael Jordan”) and fashion icons (“Kate Moss”). Although China is more willing than ever to assist Western brands in fighting trademark squatters, the wisest approach to avoid expense and heartburn to your general counsel is still to register the name as soon as possible. Use is not a requirement while infringement is a constant reality. It all boils down to a simple money question: Does it make sense to spend around $1,000 to file a mark and thereby have peace of mind or would you rather leave your brand dangling out there as a constant target for infringers and budget at least $50,000 to prepare an unfair competition lawsuit? The answer is clear — spend the $1,000 to file your mark.

The above article was originally published in Law360 on May 12, 2017

Click here to view the article on Law360

 

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