The overseas brand that lost its trademark in China to its distributor, namely the one which was squatted years ago by its distributor, still had a shot to get it straight forward by initiating a non-use cancellation.
Interstellar, a distributor of BGProduct in China, squatted the BG trademark more than 20 years ago. In the cancellation dispute, CNIPA and the Court found that Interstellar, as a dealer for BG Products,Inc., could not prove Interstellar used the BG mark in China, or meet the requirement of trademark usage in non-use cancelation under China Trademark Law. Interstellar’s registration was eventually cancelled.
BG and design Trademark
The trademark 810303, “BG and design”, was filed on June 28th, 1994 and approved for registration on the 28th of January 1996. It is designated to be used with the trademark “engine de-sulfurization chemicals”.
Disputed Trademark
Disputed Trademark of Yantai Mat
The disputed trademark was preemptively registered by Yantai Mat, a Chinese company, more than 20 year ago. It is difficult for BGProducts if they want to challenge it by filing an invalidation on grounds of bad faith because the China Trademark Law has a five-year limit to invalidate improper registrations.
The disputed trademark was transferred it to an individual named Zou YaXiong. On September 6, 2010 it was transferred from SOHO Interstellar Co. Ltd. (Interstellar Co.).
BG Dealer Agreement
BGProducts was forced to sign a BG Dealer Agreement with Zou Yaxiong. Under this agreement, Zou imported BG Products for sale in China. Zou’s status as a dealer was terminated by the 16th of July 2022. Zou is the representative of SOHO Interstellar Co., Ltd.
Non-use Cancellation
BGProducts has initiated a cancellation process for non-use of the trademark in dispute. CNIPA believed that, in both the litigation and prosecution stages, the actions of Interstellar importing BG branded products from the United States, and Interstellar selling them in China, could not prove the use of a disputed trademark as it was directed at BG products sold in the United States.
Court Judgement
The Court found that Interstellar had provided invoices, contracts and customs declarations with the BG trademark. Its authorized dealers sold products bearing the disputed trademark. All of these uses were directed at BGProducts, not Interstellar. Relevant consumers could not connect the goods with the trademark owner. In such circumstances, it was not possible to distinguish the origin of goods. Interstellar’s evidence was insufficient to show that the trademark had been used legally and effectively by Interstellar on the goods designated during the specified period. The disputed trademark was therefore cancelled because it had not been used for three years.
