"Lafite" trademark infringement and unfair competition disputes​

Case Brief:

La XX Winery is the owner of the trademarks "LAFITE" and "CHATEAU LAFITE ROTHSCHILD" (hereinafter referred to as the "trademarks involved"), which are registered for alcoholic beverages.

These trademarks have earned a high reputation through long-term use, and "LAFITE" and "拉菲" have established a strong association.

On April 1, 2005, Nanjing Jin XX Wine Co., Ltd. applied to register the trademark "拉菲庄园" for wine and other products. Subsequently, Nanjing Jin XX Wine Co., Ltd. and other companies used logos including "拉菲庄园" and "LAFEI MANOR" in their production, importation, and sale of wine. The companies also promoted the logos on their websites and transaction documents.

On December 23, 2016, the Supreme People’s Court supported the decision of the trademark administrative department to cancel the trademark "拉菲庄园".

Following this decision, La XX Winery sued Nanjing Jin XX Wine Co., Ltd. and other six companies to court.

The court of first instance found that the seven defendants’ conduct had constituted trademark infringement and unfair competition. The court ordered them to cease the infringement and imposed punitive damages.

Dissatisfied with the ruling, Nanjing Jin XX Wine Co., Ltd. and other defendants appealed.

During the second-instance hearing, the Supreme People’s Court concluded that Nanjing Jin XX Wine Co., Ltd. and others had malicious intent to free ride on the trademarks involved during the application, registration, and use of "拉菲庄园", lacking any legitimate good faith interests.

Their use of the "拉菲庄园" and "LAFEI MANOR" logos constituted trademark infringement, and their promotional claims exaggerated the historical legacy and popularity of "拉菲庄园" wines, amounting to false advertising.

The court found clear evidence of malice and severe infringement. Consequently, punitive damages were upheld, and Nanjing Jin XX Wine Co., Ltd. and other defendants were ordered to compensate La XX Winery for economic losses and reasonable expenses totaling 79.17 million RMB.

Typical Significance:

This judgment underscores that trademark registrants who attempt to free ride on existing trademarks should not be protected. It emphasizes the importance of good faith and honesty in market competition and demonstrates the determination of the people’s court to strictly penalize "free riding" on well-established trademarks.