On December 14, 2020, the CNIPA issued the leading case for Administrative Enforcement of Intellectual Property Rights "Investigation and Handling of Shanghai Zhangyuan Information Technology Co., Ltd.'s Infringement on the Exclusive Right of D&B's Registered Trademark by the Market Supervision Bureau of Chongming District, Shanghai " (Leading Case No. 1). The interpretation and application of the leading case are explained as follows.

1. Election process and guiding significance

The case was concluded by the Market Supervision Bureau of Chongming District, Shanghai on November 15, 2019. The agency handling the case affirmed that the party’s behavior was an infringement of the exclusive right of the registered trademark and imposed administrative penalties. After the decision was made, the party concerned did not file an administrative review or file an administrative litigation.

The leading case clarified that the parties use the same or similar words as the registered trademarks of others as searching keywords, and display the keywords in prominent positions, for example, the title of the webpage link on the search result page, which constitutes the use of the trademark. The leading case helped to further clarify the definition of trademark using behavior in the Internet environment.

2. The interpretation and explanation of the case’s main points

(1) The use of trademarks and the judgment of trademark infringement.

The use of trademarks plays a crucial role in the trademark legal system, which is of great significance in the acquisition, maintenance and relief of trademark rights. In recent years, the use of trademarks has been gradually separated from the judgment of "probability of confusion" as an independent infringement judgment element in the practice of administrative law enforcement. For one thing, it can reduce the risk caused by the loosening of the "probability of confusion" infringement judgment standard, and balance the interests of the public and the right holders better; for another thing, it can avoid the complexity of the "probability of confusion" judgment and exclude some cases from the judgment to save limited administrative resources and improve efficiency. Based on this, paragraph 1 of Article 3 in Standard of Trademark Infringement Judgment issued by CNIPA on June 15, 2020 stipulates that “To determine whether a trademark infringement constitutes a trademark infringement, it is generally necessary to determine whether a suspected infringement constitutes a trademark use in the sense of trademark law." 

(2) The use of trademarks in the Internet environment.

The focus of the leading case is whether the use of words that are identical or similar to others’ registered trademarks in Internet keywords searching constitutes the use of trademarks. In the environment of Internet, the performance of trademark use show diversified characteristics, and how to define whether the use of relevant signs belongs to the use of trademarks in the sense of trademark law is also extremely complicated. There are two common cases of using words that are the same or similar to others’ registered trademarks in keyword searching: one is to use words that are identical or similar to others’ registered trademarks in the keyword part of the search engine, which means the words are only used for keyword promotion without showing in the search results, that is, internal use; the other is to display the text in prominent positions like the title linking to searching result web page except the keyword part, that is, external use. The said leading case belongs to the second one. The Internet users entering keywords in search engines are to find the related information. The results showing after the search with keywords will usually make the users think they are related to the keywords. Especially the keywords at a prominent position such as the title of the search result page will strengthen the relevance, causing them to have an association that the keyword is related to a particular commodity or service, and thus considering the above link involves the product or service represented by a trademark that is identical or similar to the keyword with the function of identifying the source of the product or service. Therefore, compared with the internal use, the mentioned external use behavior is easier to produce the effect of identifying the source of goods or services, and it should be recognized as the use of trademarks.

In this leading case, the parties used the same words as the "Dun & Bradstreet" trademark of the trademark owner Dun & Bradstreet International Co., Ltd., as searching keywords, and highlighted the words similar to the registered trademark of the owner "Dun & Bradstreet" in the title link on the search result page and the content of the linked web page. For network users, the effect of trademark use is visible and perceivable. The above-mentioned actions convey the information contained in the trademark to the relevant public, easily making the public associate the trademark with its directional specific service, so as to correspond to the provider of specific service, playing a role of distinguishing the service source, which is the use of trademarks.

3 Other issues need to be explained

The leading case also covers judgment issues that can easily cause confusion on the Internet. In accordance with the Standard of Trademark Infringement Judgment, "easy to cause confusion" includes two conditions: one is enough to make the relevant public believe that the involved goods or services are produced or provided by the registered trademark owner, and the other is enough to make the public believe that the provider of the involved goods or services has investment, license, franchise or cooperation relationship with the registered trademark right holder. The word "enough" indicates that "easy to cause confusion" does not take actual confusion as necessity but just need a possibility of confusion. In this leading case, 8 companies mistakenly believed that the parties had a licensing relationship with the trademark owner Dun & Bradstreet International Co., Ltd. via searching on the Internet and based on the trademark use of the parties, and commissioned the parties to apply for Dun & Bradstreet's code. To the time of the case, the parties had collected a total of 179,100 yuan for the agency service fees of the above 8 companies. In conclusion, the parties’ use of a trademark similar to the right holder’s registered trademark on the same service not only make it possible to cause the relevant public confused with the service involved and the service provided by the right holder, but also cause an actual confusion. There is no denying that it can be determined as constituting "easy to cause confusion," and then the party's behavior is a trademark infringement.

The identification of the use of trademark in keyword searching is a global leading edge issue with few related cases at home and abroad. Under the circumstance of lacking clear provisions in active laws and regulations with still disputes in law enforcement practices, the handling agency of the said leading case accurately mastered the essence of trademark use, made accurate determinations of trademark infringements, accumulating valuable experience for trademark administrative enforcement.

From CNIPA

April 1st, 2021