Brand owners should avoid geographic names in marks to prevent confusion around their source

Article 10.2 of China’s Trademark Law  states that a foreign geographic name known to the public shall not be used as a trademark, unless the name has alternative meanings.

On 12 November 2021, the Beijing High Court overruled an invalidation decision on a trademark registration for “米兰”, the Chinese characters for the Italian city of Milan.

Jiangxi Milan is a major player in the wedding photography industry in China. Starting out as a supplier of wedding dresses marketed under the brand “米兰” in 1986, it opened a homonymic shooting studio in 1996 and obtained its first trademark registration for  (traditional Chinese for ‘Milan’) designating “photograph shooting” services in 1999. In 2010 it applied for, and obtained in 2012, registration for the simplified version of the 1986 brand “米兰” in Class 41.

In 2019, a natural person initiated an invalidation action against the contested mark, contending that it is a famous geographic name in Italy and the registration is a breach of the absolute ground set out in Article 10.2 of the Trademark Law. On 29 October 2020, the China National Intellectual Property Administration (CNIPA) backed the petition and invalidated the contested mark. In the ensuing administrative litigation, the Beijing Intellectual Property Court upheld the CNIPA invalidation decision on 24 June 2021.

Jiangxi Milan appealed before the Beijing High Court.

The Court of Appeal overturned the CNIPA’s decision, based on the following reasoning:

• The legislative purpose of Article 10.2 is two-pronged: first, to ensure public freedom of expression over geographic names and prohibit monopoly of public resources; and second, to avoid confusion and misidentification among the public. A geographic name is registrable on the premise that it has  “other meaning”, which shall cover either of the following two circumstances: the said mark has other intrinsic meaning apart from indicating a geographic name; or the said mark has acquired, through use, secondary meaning that has been acknowledged by the relevant public.
• With regard to the argument the plaintiff raised that the contested mark also refers to aglaia odorata, a flower in the Chinese language, the court ascertained that it is undeniable that the contested mark is better known as the name of an Italian city among the Chinese public. Therefore, the argument was dismissed.
• The evidence filed by Jiangxi Milan, including the scale of its business operation in China, its exceptional financial performance, continuous advertising and promotion campaigns, and recognition of the visibility of the contested mark by various administrative and judicial authorities, sufficed to attest that stable correspondence has been established between the registrant and the contested mark among the relevant public in China. The said mark has also acquired secondary meaning (other than the indication of a geographic name) through extensive use. The court affirmed that Jiangxi Milan exhibited no intention to piggyback the Italian city either in filing for, or in actual use of, the contested mark.

The court upheld the registration of the contested mark on its core services, including “photographic reporting services; photography; microfilming; recording of video tapes; production of video tapes; rental of stage scenery; production of shows; digitalising films”, and invalidated its registration on the services “translation; rental of cinematographic cameras” for lack of evidence on acquired secondary meaning.

The case may serve as a point of reference in prosecuting a trademark that is either a geographic name or has a geographic name component in China. Practitioners may resort to the parameters set out by the Beijing High Court in assessing the registrability of such a mark:

• If the public has an equivalent or higher degree of familiarity with the mark’s “other intrinsic meaning” than its  geographic name indication, the mark is registerable provided that evidence is furnished to prove its inherent distinctiveness.
• If the public has a significantly lower degree of familiarity with the mark’s “other intrinsic meaning”  than its  geographic name indication, the mark is registerable provided that it has acquired secondary meaning through extensive use and may serve as a source identifier.

In practice, the CNIPA tends to reject trademark applications with either a geographic name or a geographic name component. Brand owners should check with their local counsel before filing for such a trademark in China. For those who have managed to secure registration, registrants are advised to take extra precautions during actual use of these marks and consciously distance the mark from the geographic name to avoid creating undue association or confusion over source of origin.