Alfred Dunhill has won a huge lawsuit in China in 2018 – in a recently announced decision, the Chinese party Danhouli was found guilty for both trademark infringement and unfair competition that it has mimicked the elongated stylized iconic brand of Dunhill. The Foshan Intermediate People’s Court of Guangdong Province not only ordered the infringer to pay compensation of Yuan 10 million (about 1.5 million US dollars), but also ruled that the individual responsible for Danhouli also bears personal responsibility for the infringement. This is a major victory for Chinese rights holders, indicating that the country’s intellectual property protection system has been strengthened and aligned with other international systems.
Due to external pressures to meet its own economic goals, China has been shifting its intellectual property rights (IPR) system closer to many of the more developed countries. With the development of China’s economy, the transformation from manufacturing to knowledge-based production, more comprehensive laws, and greater emphasis on law enforcement have led to an increase in the number of IPR infringement cases filed in court or through Chinese administrative procedures. Allowing intellectual property owners to recover economic losses from infringers is an important part of the intellectual property protection system. Correctly determine that damages can play an effective deterrent role in infringing intellectual property rights and protecting innovation incentives.
The victory of the British Richmond menswear brand has stemmed from the long history between the two parties. Dunhill had previously shut down Danhuoli ‘s Hong Kong-based shadow company “Dunhill Group” with the help of court intervention. The shadow company was running to manage the business activities of the infringing brand. However, due to Danhuoli ‘s network of more than 200 franchise stores in 61 cities in China, the shutting down of the shadow company did not prevent Danhuoli from saturating the Chinese market via its infringing products.
The case represents “a milestone trademark victory in China for any global brand given the scale of damages awarded” and is also “an important milestone for China to continue its fight against intellectual property infringement”. The Yuan 10 million (about 1.5 million US dollars) compensation obtained is far higher than the average ruling of Chinese trademark infringement cases.
Just over a year prior to the instance case, New Balance won a landmark victory, and the Suzhou court ordered three Chinese shoemakers to pay more than Yuan 10 million (about 1.5 million US dollars), for violating the “NB” trademark of the US sportswear company. It was one of the highest compensation amounts that foreign companies have obtained in China’s trademark disputes.