"Korla Fragrant Pears" Rights Protection Business ①: Lots of prosecutions made millions of profits, and some people sold a box of pears to compensate tens of thousands
The Paper, reporter Tan Jun, intern Chen Ziqiang
【Editor's Note】
"Xiaoyao Town Hu spicy soup" and "Tongguan Roujiamo" trademark litigation cases have exposed many problems in the trademark field.
The State Intellectual Property Office subsequently stated that it rejected the association’s collection of relevant “membership fees” and “joint fees”.
Subsequently, as my country’s first approved and registered geographical indication certification trademark, "Korla Fragrant Pear", its association issued an emergency statement stating that the association does not have high initial fees or compulsory membership, and its "normal rights protection does not exist to sue for money." ".
However, the controversy triggered by the registered trademark litigation and rights protection incident has not stopped.
On December 12, the relevant person in charge of the Supreme Law responded to the issue of protecting the rights of geographical indications such as "Tongguan Roujiamo", clarifying that geographical indications belong to regional public resources and right holders have no right to prohibit others from properly using names contained in registered trademarks.
Good faith litigation is an important aspect of building a good faith society.
The People's Court resolutely curbed malicious litigation with a clear attitude and strong measures.
The Paper (www.thepaper.cn) sorted out more than 500 cases of trademark disputes on "Korla Fragrant Pear" and interviewed many fruit merchants, trying to uncover the problems behind the intellectual property rights protection model, and what should be paid attention to. Phenomenon.
Korla Fragrant Pear Registered Trademark Source: China Trademark Network
"Selling a few boxes of fruit, I lost nine thousand yuan in the end."
A small pear became the last straw for some troubled fruit shops to be crushed to death by camels.
In just three years, the Korla Fragrant Pear Association of Xinjiang Bayingoleng Prefecture, with a registered capital of only 30,000 yuan, has obtained at least one million yuan in benefits through litigation.
In this litigation of infringement of intellectual property rights by fruit merchants, the Fragrant Pear Association, under the operation of the legal team, carried out a large-scale and procedural lawsuit.
The average amount of compensation for an infringement case is more than 10,000 yuan.
Many of the accused merchants, some are afraid of the lawsuit, do not know how to respond and are forced to reconcile with the association; some do not know how to preserve and collect evidence, and are not good at defending legal sources, so they can only pay far more than their profits. The amount will compensate the association.
In addition, it was originally poorly managed, and after this lawsuit with a high compensation amount, it closed its doors and closed its business directly.
Feng Xiaoqing, vice chairman of the China Intellectual Property Law Research Association and a professor at China University of Political Science and Law, pointed out that on the one hand, ordinary people have less knowledge of the boundaries of the rights of registered trademarks. On the other hand, people’s courts tend to pay high compensation. The main body uses "batch" litigation against fruit shop owners and small vendors at the bottom, and relies on a large number of infringement cases to obtain high returns. Although it seems to be no problem in law, "its values are distorted."
A million-dollar rights protection "business": an average of 10,000 yuan in compensation will be awarded after winning the lawsuit
When the Korla Fragrant Pear Association in Bayingoleng Prefecture (hereinafter referred to as the Association) pointed out as a trademark licensor that the Fragrant Pears sold by merchants were suspected of trademark infringement, most of the Korla Fragrant Pear merchants who were sued were speechless.
Although some merchants told the court that he had been in the fruit business for 20 to 30 years, he did not know that the five characters "Korla fragrant pear" on the box would be infringing.
Some merchants have a more "simple" view: "I set up a stall to sell pears, and I don't know what's going on. It's time to deal with fragrant pears."
Facing an interview on the "Big Reference" column of Henan Minsheng Channel, a vendor said, "Now that we are afraid to purchase, I don't know if it is infringement or non-infringement. A box of things can be fined more than 10,000, and I will sell it. Can't earn more than ten thousand."
Merchants are faced with commercial rights protection carried out by professional trademark rights protection teams.
Before being notified of the infringement, the professional rights protection team of the Korla Fragrant Pear Association had taken screenshots of its location through the mobile phone map in advance, took pictures of its store door, and purchased a box of "Korla Fragrant Pears" from the merchant, and recorded it. In order to purchase the video, the fragrant pear packaging evidence was sealed with a seal, and the whole process was notarized by a notary.
This notary seal will be unsealed and inspected in the court.
Such evidence can be called "iron evidence" because the Civil Procedure Law stipulates that "legal facts and documents that have been notarized through legal procedures shall be used by the people's court as the basis for ascertaining the facts" unless there is evidence to the contrary that is sufficient to overturn them.
There are legal precedents that the indicted merchant argued that "I sell apples, not pears."
But mere lip service cannot convince the court.
In fact, under the "iron proof of infringement", most merchants choose to "reconcile" with the association without waiting for a court decision.
According to the analysis of 568 publicly published Korla Fragrant Pear trademark dispute judgment documents, The Paper found that 66% of the cases ended with the plaintiff Korla Fragrant Pear Association withdrawing the lawsuit.
There are no public statistics on the cost of reconciliation between the association and merchants, but most of the merchants interviewed by The Paper paid a settlement fee of more than 8,000 yuan.
The reason for the association's withdrawal of the lawsuit cannot be ruled out that it discovered that the defendant did not constitute infringement, etc., and took the initiative to withdraw the lawsuit.
However, a number of defendant merchants who withdrew the case told The Paper that they accepted the settlement conditions proposed by the association, paid a fee of 8,000 yuan and signed a settlement agreement, after which the association withdrew the case.
Many merchants interviewed by The Paper said that they chose to reconcile with the association because they did not understand the law and could not argue, and they were busy with business and did not have time to deal with it, so they would use "businessmen's thinking" to deal with it. This matter.
"We don’t know anything about those legal procedures. We are in a lawsuit for the first time in our lives and we don’t know how to go about it. It is not worthwhile to spend a few thousand dollars to get a lawyer. After all, they (the association) originally asked us to pay 7,000 Yuan reconciliation is about the same (the price of the lawyer)." Mr. Lu, a fruit vendor in Xihe District, Xinyang City, said that he settled with the association after the court session and finally compensated the other party with 8,000 yuan.
"If money is paid, the lawsuit is too time-consuming and it affects business. They (the association) call you every day and ask you to give you seven or eight thousand people, fight every day, and you are upset." Ms. Chen, a fruit merchant in Xihe District, Xinyang City, Henan Province, told The Paper.
"Lawsuits cost money and time, and a quick fight to get rid of it quickly." The fruit merchants' psychology when facing the association's prosecution was squeezed to the core and became the association's password for the merchants to "reconcile" before court.
In fact, the winning judgment is the important reason for the smooth progress of the "reconciliation".
According to 107 judgments, the association’s request for “open asking price” amounted to more than 20,000 yuan, and according to the business scale of the merchant, the maximum amount was 120,000 yuan.
The total amount of compensation requested by the plaintiff was more than 4.36 million yuan, and the court finally decided to support a total of about 1 million yuan.
Among the 87 cases where the association won the case in the above 107 cases, except for the case where the defendant was an e-commerce company and was sentenced to 100,000 yuan, the average amount of compensation for each of the 86 merchants was 10,283 yuan.
In multiple judgments, the association stated that its large-scale trademark rights protection began in 2019.
Korla Fragrant Pear Association reconciled with merchants in WeChat chat provided by interviewees
The concept of "infringement" being used: "They are people who want to'blackmail' and dare not go to the law"
In the face of trademark infringement complaints filed by the Association, some merchants are unwilling to accept private losses.
Mr. Tang from Chongzhou City, Sichuan Province received a subpoena for prosecution in 2020, and in the end he won.
He told The Paper, “As long as you stick to the legal path and have sufficient evidence and documents, the merchant will win the case. The main purpose of their association is to'extort' those who dare not go to the law and want to smuggle.”
According to Liu Kai, a lawyer from Beijing Zhongwen (Changsha) Law Firm, there is no shortage of professionals in the industry who use merchants’ "ignorance" of the law and deviations in their rights perceptions, as well as the professionalism of litigation, to make profits. Lose one is one".
In the eyes of some merchants, infringement is equivalent to losing money.
In fact, from the legal point of view, when the indicted merchants "loss money", they can consider two questions: 1. Does the name "Korla Xiangli" used in the packaging of Fragrant Pear necessarily constitute trademark infringement?
2. If there is an infringement, is it necessary to compensate?
There are two articles in the "Trademark Law" that have considered the above two situations for merchants.
First, the proper use of geographic names does not constitute registered trademark infringement.
Article 59 of the "Trademark Law" stipulates that "the general name, figure, model of the product contained in the registered trademark, or directly indicate the quality, main raw material, function, purpose, weight, quantity and other characteristics of the product, or the name of the place it contains , The owner of the exclusive right to use a registered trademark has no right to prohibit others from using it properly."
Feng Xiaoqing, vice chairman of the China Institute of Intellectual Property Law and a professor at China University of Political Science and Law, told The Paper, “The proper use here refers to the description and explanation of the specific area (place name) from which the goods involved in the case come from. The trademark owner has no right to prohibit it. That is to say, no matter whether the merchant sells fragrant pears in the Korla area of Xinjiang, as long as the'fragrant pears' sold by them are indeed from the origin of Korla, Xinjiang, even if they do not obtain the'Korla fragrant pears' if they meet the sales quality standards. It is also possible to put the words "Korla Fragrant Pear" on the fragrant pear fruits sold by the certification trademark. This is because this is a legitimate and goodwill use of the place name "Korla"."
Feng Xiaoqing introduced, “As a public resource, place names cannot be monopolized by anyone. After being registered as a trademark by a certain market entity, they cannot be used even in the sense of place names. Otherwise, for market competitors, It is unfair to the general public. The above-mentioned provisions well reflect the relationship between the protection of trademark exclusive rights in the Trademark Law and the protection of the public interest and public interest."
Second, there is a "legitimate source defense" that is infringing but can be exempt from compensation.
The second paragraph of Article 64 of the "Trademark Law" stipulates: "If you sell goods that you don't know are infringing on the exclusive right to use a registered trademark, and you can prove that the goods are legally obtained by yourself and explain the provider, you shall not be liable for compensation."
Feng Xiaoqing said, "The above-mentioned provisions of the Trademark Law are intended to provide good-faith sellers with a'safe harbor' exempted from liability. Otherwise, it is difficult for good-faith sellers to verify whether the goods they purchase are suspected of infringing trademark exclusive rights under normal circumstances. The need to bear the liability for compensation will in fact hinder the free circulation of tangible goods. This provision also reflects the protection of free competition in the trademark law and the consideration of the legitimate rights and interests of the parties in a fair and reasonable manner. At the same time, from a legal point of view, the The regulations also reflect the concept and principle of "no fault and no liability for infringement" in the intellectual property legal system."
Only a small number of merchants will carefully consider these two issues and insist on bringing the lawsuit down.
For fruit merchants, what are their chances of winning a lawsuit?
According to the rough statistics of The Paper, among the 107 substantive judgment cases, 81% of the cases partially or fully supported the plaintiff's Korla Fragrant Pear Association's petition.
In other words, less than 20% of merchants’ defenses are supported.
Among them, some of the cases supported the merchants in the original trial, and the Korla Pear Association filed an appeal or applied for a retrial. In the end, the merchants lost the case.
If you lose the case, you will face compensation.
Trademark infringement compensation of about 10,000 yuan has caused dissatisfaction among some merchants.
"When I mentioned this, I was so angry. Selling a few boxes of fruit, I finally lost nine thousand yuan. I didn't earn nine thousand yuan even if I sold it! Now I don't dare to sell this fragrant pear anymore. "Ms. Liu from Xingyuan Store in Jiaozuo City, Henan Province, who was sentenced to pay 10,000 yuan and finally settled with the association to pay 9,000 yuan, said in an interview with The Paper.
In many verdicts, the defendant merchant mentioned that it only sold a few boxes of fragrant pears, and one of them was sold to the association.
The selling price of a box of these fragrant pears is mostly 25 yuan or 20 yuan, and the purchase price is 16 yuan.
Merchants transfer funds to the association to provide interviewees
Closed mom-and-pop shop: "received high profits" is a kind of "false accusation"
For other fruit merchants who are already poorly managed and at a lower level, the "high" compensation is the last straw that crushes the camel.
For example, the Xiaoteng Fruit Shop in the case of Xiuzhou Court in Jiaxing, Zhejiang Province.
As the plaintiff’s association, the complaint is in serious French language: “The defendant, as a sales company in the same industry, knows the reputation of the plaintiff’s trademark and products, but still deliberately clings to the plaintiff’s goodwill and reputation, infringing on the plaintiff’s legitimate rights and interests. The defendant is not the plaintiff. The members used “Korla fragrant pear” and other related signs without authorization, which caused the relevant public to mistakenly believe that the goods they sold were provided by the plaintiff, and obtained high profits. The defendant’s infringement was highly subjective and malicious, disrupting the market The operating order is obviously improper."
The association's litigation materials received by the merchant.
Interviewee provides
The defendant’s reply is in another language.
"The owner of the Xiaoteng Fruit Shop was a primary school student who had not finished the third grade 45 years ago. He has been farming at home for 41 years, and he has been selling fruit in Jiaxing for just over three years."
Xiaoteng Fruit Shop argued that it did not sell Korla fragrant pears to the plaintiff.
The reason is that on November 1, 2020, two people from the Association came to buy "Korla Fragrant Pears", and they clearly stated that "there are no more, only ordinary Fragrant Pears".
At the request of the customer, the empty box of "Korla fragrant pears" was packed into a box of ordinary fragrant pears.
After weighing the account, the people of the association asked him to issue a receipt, and he also said that he could not write.
It was only under the guidance of the people of the association that the receipt was written.
Xiaoteng Fruit Store also stated that shortly after the transaction, it received a letter from the association’s lawyer, “The main content is that you have infringed the Peacock brand trademark registered by the Korla Association. If you don’t make compensation, you will use legal means to enforce it, ruining your store’s reputation.” “After receiving the letter, Xiaoteng Fruit Store was frightened, panicked, and unwilling to work, until later as long as he heard a call from that mobile phone number. With text messages, the husband and wife will tremble all over, and there will be no master."
In court, the association did not deny the lawyer’s letter, but stated that “it was sent by another lawyer before.”
The Paper noted that the court did not recognize the claim that Xiaoteng Fruit Shop had clearly informed the association that it sold "ordinary fragrant pears."
Rather, the investigation was conducted around the origin of the "Korla Fragrant Pear" cartons and whether the source business opportunities were authorized by the association.
Xiaoteng Fruit Store stated that its products came from the Xinxin Erbu Fruit Wholesale Market, and provided the sales slip and its business license. In addition, it also provided 9 recordings of conversations with the proprietress to confirm the existence of the transaction.
However, during the trial, the person in the second department of Xinxin said that he was not sure whether the Xiaoteng Fruit Store would take the goods from it. They took the goods from Tang Lianying, and the pears were from Xinjiang.
Tang Lianying said that it pays to the carton factory every year, and the carton factory is authorized by the Fragrant Pear Association.
The fragrant pears are harvested from Alar City and Korla, and there is an orchard at home, and they are grown by themselves.
There is also a (trademark) authorization for planting at home, in short, it sells authentic fragrant pears.
The association stated in court that Tang Lianying was not its member.
Xiaoteng Fruit Store retorted, "That was an internal matter between the plaintiff's members, and Xiaoteng Fruit Store, as the bottom seller, couldn't tell the difference."
However, Xiaoteng Fruit Store eventually lost the case.
The court stated that “it was impossible to confirm that the sales originated from Xinxin Second Department, and the defendant and Tang Lianying did not constitute a direct sales relationship. Even though they purchased the goods from Xinxin Second Department, the defendant did not conduct the necessary review of their rights at the time of purchase, and it is difficult to determine Its legal source defense was established." Xiaoteng Fruit Store was ultimately determined to constitute an infringement, and the association was awarded 7,000 yuan in compensation.
The Paper noted that Xiaoteng Fruit Shop was very angry at the association's claim that it had “obtained high profits” through infringing goods, and considered it a kind of “false accusation”. In the most difficult stage, the total daily turnover rarely exceeds 400 yuan, just keeping the store open."
The verdict stated that the shop is now closed.
"Now the husband and wife are in a state of unemployment. Shouxin responded to the so-called infringement case of the Korla Association. The reason why the husband and wife of Xiaoteng Fruit Shop ended up like this is due to many reasons, and the feeling of depression caused by the occurrence of this case. There is a main reason." Xiaoteng Fruit Shop stated in its defense.
On the evening of November 28, The Paper contacted Ms. Teng, the operator of Xiaoteng Fruit Shop.
She told reporters in a helpless tone, "We poor people really can't afford it, and we finally admit it", and then hung up the phone.
The doubts of late-stage cancer merchants: "Why not punish wholesalers and trademark printers?"
So, what about winning the case after all the hardships?
In combing through 107 cases, The Paper noticed a phenomenon. Even if the court found that the defendant’s legal source had successfully defended, 90% of the courts would still rule that the business should bear the “reasonable expenses” incurred by the association’s rights protection lawsuit.
This fee includes at least 700 yuan for attorney fees and 300 yuan for notarization fees, and is generally above 1,000 yuan.
Liu Kai introduced that whether the right holder can claim reasonable expenses from the infringer in the defense of legal sources is not clearly stipulated in the law and judicial interpretation.
However, in the relevant cases and announcements heard or issued by the Supreme People’s Court, it was stated: “The legal source defense is established to exempt the sellers and users who are accused of infringement from the liability for damages due to reasonable expenses incurred on the basis of infringement, and the damage The legal nature of compensation is different from reasonable expenses. In principle, the accused infringer should still bear the legal expenses paid by the right holder to stop the infringement."
However, for the accused merchants, they did not distinguish the nature of this "reasonable expense" and "infringement compensation."
A woman surnamed Liu told The Paper that many vendors who were indicted with her chose to go private with the association. “Many merchants gave the association 2000 yuan, and they withdrew the lawsuit. What method, but I didn’t expect to lose more in the end..."
In this regard, Feng Xiaoqing believes that “since the lawful source defense is established, the defendant has no subjective fault, and there is a legal basis for not to bear the damages. However, the plaintiff still has to bear the reasonable expenses paid by the plaintiff for his rights protection. ."
"Successful defense of legal sources must also compensate the other party's'reasonable expenses' for defending rights, which encourages trademark holders to use their rights for profit." Liu Kai believes.
In fact, in the eyes of many merchants, they are also victims to some extent.
The main obligation to safeguard the rights and interests of the registered trademark of Korla Fragrant Pear should not lie with them.
The aforementioned Xiaoteng Fruit Shop stated in its defense that “the plaintiff, as the association of the source of Korla fragrant pears, has defended its rights for many years, shouldn’t its members be required to make Korla fragrant on the box of the fragrant pears when they are shipped? Is the pear and peacock screen publicity related to trademarks and infringements that must be investigated? Shouldn’t publicity be the focus of rights protection? What is the practical significance of blindly blaming a member of the Xiaoteng fruit shop in the vast crowd? Korla Association There is no publicity so that everyone knows that'Korla Fragrant Pear' and Peacock Kaiping are trademarks. It is reasonable for Xiaoteng Fruit Shop to not know about it."
On December 1, Ms. Bai, a fruit merchant in Erqi District, Zhengzhou City, also expressed a similar view to The Paper. “You said that they (the association) will not attack rights protection from the source, or sue major wholesalers and trademark printing houses. We come to prosecute the lowest level of us, I don’t know what we think.”
In the first half of this year, the Xuchang Intermediate Court in Henan Province, Mr. Yang, a merchant in advanced cancer, also expressed similar views.
He told the court that he had no knowledge of the infringement and had a formal purchase channel, and then raised the "four questions": Can ordinary people recognize the appearance and trademark of Korla fragrant pear?
How did substandard fragrant pears appear at regular wholesalers?
The fake trademark was not printed by ourselves, but appeared on the box of fragrant pears we purchased. Do you want to find the upper-level seller?
The Fragrant Pear Association is well aware of the importance of the trademark and should look for the source of the fake trademark. Some merchants infringed the trademark and sold goods without knowing it. Why did the association not remind and urge the merchants to stop selling and destroy it after discovering it? Fines many merchants for this reason?
At the same time, Mr. Yang provided the court with a copy of the inpatient medical record of the Yanling County Central Hospital, the Xuchang Medical Insurance Medical Insurance Registration Form for Major and Major Diseases, and the inpatient certificate of Yanling Hospital, which proved that he was a terminal cancer patient, and his economic conditions were worrying and weak. Bear the 30,000 yuan compensation claimed by the association.
However, the Xuchang Intermediate People's Court held that the evidence submitted by the defendant Mr. Yang “violated the principle of relevance of evidence” and was not accepted.
In the end, the Xuchang Intermediate People’s Court stated that “the plaintiff’s actual losses due to the infringement and the infringer’s benefits due to the infringement are difficult to determine. Factors such as the degree of fault, business conditions, etc.", the defendant Mr. Yang was determined to compensate Korla Fragrant Pear Association for economic losses of 10,000 yuan.