‘Peppa Pig’ has for the first time been recognised as a well-known trade mark in China

‘Peppa Pig’ is a British preschool animated television series whose charm has extended well beyond the UK and gained millions of fans. China is no exception. There, Peppa Pig is known as 小猪佩奇.

In April 2019, Entertainment One UK Limited (‘E-One UK’, owner of Peppa Pig) spotted a product, the so-called ‘Creative Cartoon Peppa Pig LED Table Lamp’, on the Chinese e-commerce platform Pinduoduo (see an IPKat post on Pinduoduo here). The seller was an individual, Chen Jianguang (Chen).

The packaging of the alleged infringing product is shown below, which, apparently, bore both the words Peppa Pig and 小猪佩奇:

According to this Kat’s own investigation, in April 2019, E-One UK’s trade mark portfolio in China did not cover Peppa Pig nor 小猪佩奇 in class 11 (for table lamps). E-One UK did file a trade mark application for ‘PEPPA PIG’ in class 11 on 30 September 2018 (no 33849640). However, it was under preliminary examination and was not published until 27 September 2019; its application of 小猪佩奇 in class 11 took place already in 2020.

Therefore, on 20 September 2019, when filing a lawsuit at the Shanghai IP Court, E-One UK had no direct trade mark basis to invoke against the defendants.

To establish the cross-class trade mark protection, E-One UK referred to, quite possibly, its most robust trade mark registration in China, namely, 小猪佩奇 in class 9 (no 12330790), registered in 2014 for inter alia cartoons, video cassettes, DVDs, records, and audio books, as shown below:

Registration no 12330790

E-One UK requested (1) Chen to stop infringing the rights in registration 12330790; (2) Chen and Shanghai Xunmeng Information Technology Co., Ltd. (‘Xunmeng Ltd’, a Pinduoduo platform operator) to jointly bear the damages and reasonable expenses totalling CNY 500,000. (Case reference: (2019) Shanghai 73 Minchu No 674.)

Issue one: Is registration 12330790 a well-known mark?

Legal basis: 

Article 14 of the PRC Trade Mark Law (2013 Amendment):*

Whether a trade mark is a well-known trade mark shall be determined upon request of a party as a fact to be found in the handling of a trade mark case. The following factors shall be taken into account in the determination of a well-known trade mark: 　　

(1) Reputation of the trade mark to the relevant public;

(2) Duration of the use of the trade mark;

(3) Duration, extent, and geographical area of any publicity of the trade mark;

(4) Records of protection of the trade mark as a well-known trade mark;

(5) Other factors relevant to the determination of a well-known trade mark.

And similarly, Article 5 of the Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of Law to the Trial of Cases of Civil Disputes over the Protection of Well-known Trade Marks:

To allege the popularity of a trade mark, a party concerned shall, in light of the concrete circumstances of the case, provide the following proofs to demonstrate that its trade mark is already famous at the time of occurrence of the trade mark right infringement or unfair competition:

(1) the market share, marketing regions, profits, taxes, etc. of the commodities using the trade mark;

(2) the duration which the trade mark has been continuously used;

(3) the manner, duration, extent, money input, and geographical scope of publicity or promotion of the trade mark;

(4) the records that the trade mark has ever been protected as a well-known trade mark;

(5) the market reputation of the trade mark; and

(6) other facts that can demonstrate that the trade mark is well-known.

The duration, scope, manner, etc. as described in the preceding paragraph regarding the use of the trade mark shall include the information about the continuous use of the said trade mark prior to the examination and approval of the registration thereof. The people’s court shall, by taking into consideration other proofs for determining the popularity of the trade mark, objectively and thoroughly examine such proofs. For instance, the length of use of the trade mark, industrial ranking thereof, market investigation report, market value assessment report, and whether it has ever been certified as a well-known trade mark.

Of course, no one factor listed above is determinative, nor all of them need to be present. Instead, both administrative agencies and courts will make comprehensive assessments based on the different circumstances of each individual case.

The Court’s ruling:

The evidence submitted by the plaintiff can prove that, as of April 2019, the cartoon Peppa Pig has achieved a very high broadcast rate on CCTV (China Central Television) and several video platforms including iQIYI, Tencent and PPTV, and has a large number of viewers nationwide;

From 8 August 2015 to 8 August 2019, a number of national media carried out continuous promotion of Peppa Pig’s cartoon, books, DVDs and Peppa Pig brand derivatives;

The plaintiff has authorised a number of Chinese companies to use the trade marks in question, and derivatives of the trade mark have become extremely popular with consumers;

Peppa Pig (Series 1, limited edition, a set of 10 books and 1 DVD) ranked first in the juvenile category of the online open book bestseller list from January 2017 to June 2017;

The trade mark involved in the case received administrative and judicial protection in the past;

Therefore, through the continuous promotion and use of the registration 12330790 by the plaintiff and its authorised companies, the trade mark has enjoyed a high degree of popularity and reputation in cartoons and electronic publications (downloadable). That has met the requirements for the recognition of well-known trade marks stipulated by the law and should be recognised as a well-known trade mark.

The aforementioned ‘administrative and judicial protection in the past’ refers to a series of enforcement initiatives of the plaintiff. (Kat’s note: I am not sure those enforcement initiatives were against the same infringer or based on the same trade mark right, considering no further information concerning the specific classes of trade marks was provided):

The Junan County Public Security Bureau (of Shandong Province), the Lanshan Branch of the Linyi Public Security Bureau (of Shandong Province), the Longgang Branch of the Shenzhen Public Security Bureau (of Guangdong Province), and the Dongguan Public Security Bureau (of Guangdong Province) detained criminal suspects of infringing on “Peppa Pig” and its related trade marks and detained suspected infringing products;

Linyi City Administration for Industry and Commerce (of Shandong Province) issued the Administrative Penalty Decision Letters [2018] No 198 and 202, which imposed administrative penalties on the parties involved in the infringement of the trade mark involved;

The Laishui County Market Supervision and Administration Bureau (of Hebei Province) imposed administrative penalties on the parties who infringed the plaintiff’s trade mark involved in the case;

The Criminal Judgment (2018) Guangdong 0307 Criminal, First Instance, no 3797 issued by the People’s Court of Longgang District, Shenzhen, Guangdong Province, imposed criminal penalties on the defendant who infringed on the plaintiff’s registered trade mark.

Issue two: Whether the defendants’ actions constituted infringement?

As to well-known trade mark uses on different goods, Article 13(3) of the PRC Trade Mark Law (2013 Amendment) provides as follows:

Where a trade mark for registration to be used on different or dissimilar goods is a copy, imitation, or translation of a well-known trade mark of another party which has been registered in China, misleads the public, and may cause damage to the interests of the registrant of the well-known trade mark, it shall not be registered and shall be prohibited from use.

Accordingly, the Court held that:

The defendant Chen used the words “Creative Cartoon Peppa Pig LED Table Lamp” in the product name on the webpage of his shop opened on the Pinduoduo platform and used “Creative Cartoon Peppa Pig LED Table Lamp” text and “Creative Cartoon Peppa Pig LED Table Lamp” text combining pictures on the outer packaging of the alleged infringing products.

The first two acts copied the plaintiff’s trade mark registration 12330790; The latter imitated the plaintiff’s registration 12330790, which has misled the public and would damage the interests of the plaintiff, and violate the plaintiff’s right to the exclusive use of the registered well-known trade mark 12330790.

As to Xunmeng Ltd, the Court ruled:

The defendant Xunmeng Ltd is an operator of the Pinduoduo platform involved, and there is no evidence to prove that it has jointly carried out the alleged infringement with the defendant Chen. There is no evidence to prove that it should have known that the product involved in the case sold by the defendant Chen is a product that infringe the plaintiff’s trade mark rights and did not take any measures in this regard. Given that Xunmeng Ltd has taken measures to block the product links involved, the plaintiff's claim on Xunmeng Ltd constituted an infringement lacks facts and legal basis, thus is not supported by this court.

Issue three: Civil liability

Defendant Chen argued the alleged infringing products sold by him had legitimate sources as they were purchased from sellers at Taobao.com. However, his submitted evidence failed to support such a claim, nor did his evidence manage to prove the claim that he had performed a reasonable duty of care when purchasing the goods. Thus, the Court found Chen had infringed the plaintiff’s trade mark right of registration 12330790 and thus should assume the civil liability of infringement.

Given that Chen had not been selling the infringing products since their removal from Pinduoduo by Xunmeng Ltd on 6 June 2019, and no evidence could prove the opposite, the Court did not support the plaintiff’s request for Chen to stop the infringement.

As to the amount of compensation for trade mark infringement, Article 63(1) and 63(3) of the PRC Trade Mark Law (2013 Amendment) provides as follows:

(1) The amount of damages for infringement upon the right to exclusively use a registered trade mark shall be determined according to the actual losses suffered by the right holder from the infringement; where it is difficult to determine the amount of actual losses, the amount of damages may be determined according to the benefits acquired by the infringer from the infringement; where it is difficult to determine the right holder’s losses or the benefits acquired by the infringer, the amount of damages may be a reasonable multiple of the royalties. If the infringement is committed in bad faith with serious circumstances, the amount of damages shall be the amount, but not more than three times the amount, determined in the aforesaid method. The amount of damages shall include reasonable expenses of the right holder for stopping the infringement. [Kat’s note: The 2019 Amendment increases the “three times” to “five times”]

…

(3) Where it is difficult to determine the actual losses suffered by the right holder from the infringement, the profits acquired by the infringer from the infringement, or the royalties of the registered trade mark, a people’s court may award damages of not more than CNY three million according to the circumstances of the infringement. [Kat’s note: The 2019 Amendment increases the “CNY three million” to “CNY five million”]

Furthermore, the documented evidence failed to prove the plaintiff’s actual losses or the defendant’s infringement benefits, and there is no trade mark license fee concerning the trade mark at issue as a reference. In addition, considering the plaintiff claimed statutory compensation as well, the Court comprehensively weighed the following factors in determining the compensation for the plaintiff’s economic losses:

The nature of the defendant’s infringement, the period, scope, consequences, the defendant’s subjective intentions, and the popularity and reputation of registration 12330790 involved.

The plaintiff claimed damages and reasonable expenses totalling CNY 500,000. The Court supported the claimed notarisation fee of CNY 1,000 in full and supported the claimed lawyer fee of CNY 50,000 as appropriate. Finally, the Court ordered the defendant Chen, within 10 days from the effective date of judgement, to pay the plaintiff for the economic losses and reasonable expenses, totalling CNY 30,000.

Since neither party appealed, the judgment has come into effect.

Comments

When it comes to well-known trade marks, supporting evidence is of the essence. In light of the relatively complex evidence requirements, right holders are often in a difficult position facing the onerous burden of proving their marks’ status of well-known. Thus, considering Peppa Pig’s official China licensing programme was only fully launched towards the end of 2017, it is impressive to see the number 12330790 trade mark being identified as a well-known mark in China so quickly.

The Peppa Pig team managed to collect massively scattered evidence in abundance concerning its numerous trade mark licensees in China and the related peripheral derivatives they produced. At court, the fact of ‘the well-known Peppa Pig in China’ was reasonably well illustrated.

A quick side note here: according to Xunmeng Ltd’s website operation log, merely three infringing products had been sold by 6 June 2019, i.e., the day when Xunmeng Ltd removed the product’s link at Pinduoduo. That prompted a discussion on the following topic: ‘three negligible table lamps lead to a CNY 500,000 drastic punishment’. That said, the actual compensation of damage was far less; secondly, the whole case, from its filing to closure, was pursued rightfully within the current civil procedure framework. The plaintiff’s legitimate civil litigation rights were exercised unsurprisingly and protected as per law, nothing more. In all consideration, this case is undoubtedly a (repeated) wake-up call for deliberate infringers.

*The 2013 Amendment of the PRC Trade Mark Law was revised by the 2019 Amendment (effective date was 1 November 2019).

Images source: Shanghai IP Court and the Trade Mark Office of China.