The case of trademark infringement and unfair competition filed by Inter IKEA Systems B.V. (“IKEA”), a world-renowned home furnishing retailer, against a home furnishing company., Yang XX and other defendants, has been successfully included in the "Typical Cases of Intellectual Property Judicial Protection in Foreign-related, Hong Kong-Macao-Taiwan-related and High-tech Fields" released by the Nanjing Intermediate People's Court.
Basic Case Facts-
IKEA is a globally renowned home furnishing retailer. Its Chinese characters trademark of "Yi Jia (IKEA in Chinese)" trademark was registered in 1995 for goods of Class 20 including furniture. Due to a failure to renew a registration in a timely manner, the trademark was announced as cancelled in 2014. IKEA immediately filed a new application and formally regained the exclusive right to use the " Yi Jia (IKEA in Chinese)" trademark in August 2014.
During the aforementioned period, the company defendant had continuously used its corporate name including Chinese characters “Yi Jia (IKEA in Chinese)” since 2009 and extensively used commercial identifiers such as "Rui Li Yi Jia”. The last two Chinese characters Yi Jia are the Chinese version mark of IKEA and "Yi Jia Pin Zhi (IKEA Quality in Chinese)" in its business activities. It prominently promoted the purported association between its products and "Yi Jia (IKEA in Chinese)" brand, thereby misleading consumers.
IKEA argued that the "IKEA in Chinese" trademark, having been used in China for a long time, had attained an extremely high market reputation and brand recognition, qualifying it as an unregistered well-known trademark. The defendants' acts constituted not only trademark infringement but also unfair competition against a well-known brand. Consequently, IKEA initiated legal proceedings before the court, requesting an order that the defendants immediately cease all infringing acts and compensate for economic losses and reasonable expenses totaling RMB 5,000,000.
Court’s Rulings-
After trial, the Nanjing Intermediate People's Court held that:
The "Yi Jia (IKEA in Chinese)" trademark constitutes an unregistered well-known trademark: Prior to July 2009, the "Yi Jia (IKEA in Chinese)" trademark had already achieved an extremely high reputation in the relevant market in China for furniture products. Relevant members of the public generally established a stable association between the trademark and IKEA, satisfying the criteria for recognition as an unregistered well-known trademark.
The acts constitute trademark infringement: The defendants' use of identifiers such as "Rui Li Yi Jia" and "Yi Jia Pin Zhi" on identical or similar goods is highly similar to the "Yi Jia (IKEA in Chinese)" trademark in terms of literal composition, pronunciation, and overall visual effect, which is likely to cause confusion and misidentification among relevant members of the public, thus constituting an infringement of the exclusive right to use the "Yi Jia (IKEA in Chinese)" trademark.
The acts constitute unfair competition: The defendants' use of "Yi Jia (IKEA in Chinese)", an unregistered well-known trademark with extremely high reputation owned by another party, as their enterprise name, demonstrates a subjective intent to free-ride on the goodwill of IKEA. Objectively, such use is sufficient to mislead the public, constituting an act prohibited by the Anti-Unfair Competition Law that "causes the public to mistakenly believe that the goods are those of another person or have a specific connection with another person".
The court ultimately ruled that the defendants must immediately cease all infringing acts and compensate IKEA for economic losses and reasonable rights protection expenses totaling RMB 1,500,000. The defendants appealed against the first-instance judgment but subsequently withdrew their appeal, and the first-instance judgment has since taken legal effect.