New Balance win a boost for foreign brand protection

The Shanghai Pudong People’s Court has issued a first-instance judgment of the unfair competition case of New Balance Athletics (China) v New Barlun (China) and Chengpeng Sports Shoes Store, finding that New Barlun needs to pay New Balance RMB10.8 million (US$1.5 million) for economic losses and reasonable expenses, and ordering it to halt unfair competition to eliminate the public impact on the New Balance brand.

Carol Wang, head of the Shanghai litigation group at Lusheng Law Firm, who represents the plaintiff, told China Business Law Journal: “The trend is that China is taking efforts to enhance protection for genuine IP holders, and is much less tolerant of bad-faith trademark registrants.”

Peter Huang, who also participated in the case when he was in Lusheng, said trademark protection had regional characteristics, and rights holders should seek relief based on the legal system of the country where they are located. He is now the senior partner of Hiways Law Firm‘s Shanghai office.

Huang said that, in dealing with trademark cases, rights holders should consider whether there is a bad-faith pre-emptive registration, and trademark infringement. The former examines the “legitimacy of trademark applications”, while the latter examines the “legitimacy of trademark use”.

Since New Balance entered China’s market in the 1990s, it has confronted dozens of Chinese companies in court. According to Lusheng, this case has dragged on for 16 years, and New Balance had provided a lot of evidence about market confusion about the brand.