Risks of TM Infringement Caused by App Names

Analysis of Elements Concerning Trademark Infringement of App Names

Author: Betty Chen

Essentials of Judgment

Where the app mark is similar to some registered trademark, identification of infringement upon exclusive right to use should factor in: 1. whether the designated goods or services of two parties belong to identical or similar goods or services; 2. the trademark distinctiveness and popularity; 3. whether there is the bad faith of free-riding on the goodwill of trademarks.

Reference

First Instance: (2019)-Ji-(01)-Min-Chu No. 64 Civil Judgment

Case Summary

The plaintiff (Ping An Pu Hui Investment Consulting Co., Ltd., hereinafter referred to as “Ping An Pu Hui Company” started in September 2005, is the main operator of Pu Hui financial business under the Ping An Group of China. Ping An Insurance (Group) Company of China (hereinafter referred to as “Ping An Group”) has registered the following trademarks with approval of the Trademark Office of State Administration for Industry and Commerce, No. 6974777 “平安 (PING AN)” valid from June 7, 2014 to June 6,2024, designated on recorded computer operation program, computer software (recorded), computer program (downloadable software), etc. in Class 9; No. 6974781 “平安 (PING AN)” from July 14, 2013 to July 13, 2023, designated on advertising, providing business information and advice to consumers (consumer advice agency), etc. in Class 35; No. 6974784 “平安 (PING AN)” valid from June 21, 2010 to June 20, 2020, designated on financial services, financial loans, financial management, etc. in Class 36; No. 16903638 “平安普惠 (PING AN PU HUI)” valid from July 7, 2016 to July 6, 2026, designated on recorded computer operation program (program), downloadable computer software, computer software (recorded), etc. in Class 9; No. 16903048 “平安普惠 (PING AN PU HUI)” valid from July 14, 2016 to July 13, 2026, designated on advertising, etc. in Class 35; No. 16903362 “平安普惠 (PING AN PU HUI)” valid from July 7, 2016 to July 6, 2026, designated on financial services, etc. in Class 36. Ping An Pu Hui Company, authorized by Ping An Group, has the right to litigate against the infringing activities upon the exclusive right to use of the above trademarks in the name of itself.

The defendant (Jilin Wanhe Film and Television Culture Communication Co, Ltd., hereinafter referred to as “Jilin Wanhe Company”) was established on August 22, 2006, with registered capital of RMB 1 million. Its business term starts from August 17, 2010, to August 15, 2026. The business scope includes design, production, and agent service of all kinds of domestic advertising business; advertising business such as releasing street signs, lightboxes and neon lights; distribution of teaching equipment.

The defendant (Jilin Shengjing Street Lamp Power Equipment Co., Ltd., hereinafter referred to as “Jilin Shengjing Company”) was established on September 26, 2014, with registered capital of RMB 20 million. Its business term starts from September 26, 2014, to September 18, 2034. The business scope includes street lamp engineering construction; lighting engineering construction; urban road lighting engineering construction, etc.

The plaintiff instituted litigation with the court of the first instance against the defendants’ unauthorized use of the app title “平安惠APP (PING AN HUI APP)” and marks therein that are identical or similar to the disputed trademark, which has infringed upon the plaintiff’s exclusive right to use of the registered trademark. And the plaintiff simultaneously sued defendants for unauthorized use of its unique name with high popularity, which has constituted unfair competition. A petition was filed to impose a ban on defendants’ infringing activities and a fine of RMB 100,000 as compensation for financial loss along with relevant reasonable expenditures.

The court of the first instance holds:

First of all, the online loaning products, financial services, advertising provided by the accused app “平安惠APP (PING AN HUI APP)” are identical or similar goods/services to the designated goods/services under the six registered trademarks, No. 6974777 “平安 (PING AN)”, No. 6974781 “平安 (PING AN)”, No. 6974784 “平安 (PING AN)”, No. 16903638 “平安普惠 (PING AN PU HUI)”, No. 16903048 “平安普惠 (PING ANPU HUI)”, No. 16903362 “平安普惠 (PING AN PU HUI)”.

Secondly, Ping An Group as a corporation enjoying goodwill in China boasts the registered trademarks “平安(PING AN)”, “平安普惠 (PING AN PU HUI)” that are well-known in the industry and familiar to the relevant public. Therefore, Jilin Wanhe Company and Jilin Shengjing Company in the same industry should reasonably be aware of the popularity and influence of involved trademarks amid the development of the app “平安惠APP (PINGAN HUI APP)”. The texts “平安惠(PING AN HUI)”, “平安普惠 (PING AN PU HUI)” have been put into multiple-use inside the accused app “平安惠APP (PING AN HUI APP)”, which show up at the mobile apps searching interface, the details, introductions, and pictures of the download and installation interface, etc., and the icon of the accused app appears as the combination of “logo” and “平安惠 (PING AN HUI)” on the phone after being installed. Such use belongs to trademark use. The characters “平安 (PING AN)” incorporated in “平安惠 (PING AN HUI)” are identical to the text “平安 (PING AN)” of the involved registered trademarks. “平安 (PING AN)”, “惠 (HUI)” are the same characters included in the registered trademark “平安普惠 (PING AN PU HUI)” and listed in the same order only with another character missed out.

Consequently, “平安惠 (PING ANHUI)” has constituted similarity with registered trademark “平安普惠 (PING ANPU HUI)”, and “平安普惠 (PING AN PU HUI)” is identical to registered trademark “平安普惠 (PING ANPU HUI)” in text and listing order. The trademark use of texts “平安惠(PING AN HUI)”, “平安普惠 (PING AN PU HUI)” is very likely to cause misidentification among the relevant public on the source of goods (services). In the absence of authorization of the registrant, the defendants used marks identical or similar to the involved registered trademarks on identical goods (services), which may cause confusion and misidentification among the relevant public on the source of goods (services) and belongs to the infringement upon the exclusive right to use of involved registered trademarks.

At the end of the trial, the court rendered the judgment of imposing a ban on defendants’ infringing activities upon the exclusive right to use of trademarks No. 6974777 “平安 (PING AN)”, No. 6974781 “平安 (PING AN)”, No. 6974784 “平安 (PING AN)”, No. 16903638 “平安普惠 (PING AN PU HUI)”, No. 16903048 “平安普惠 (PING ANPU HUI)”, No. 16903362 “平安普惠 (PING AN PU HUI)”. The defendants were ordered to cease using the texts “平安惠 (PING AN HUI)”, “平安普惠 (PING AN PU HUI)” in the title, icon, download and installation interface and other parts inside the app, and fined RMB 65,000 as compensation for the plaintiff’s financial loss (including reasonable expenditures).

Contexts:

At times driven by “Internet Plus”, industries have been benefited from Internet platforms in the development of mobile apps for resources synthesis and business outreach, which shall presumably scale up the dimensions of corporate operation and healthy competition. Under such circumstances, some companies might have successfully registered a trademark on “computer operating programs” in Class 9 while others are running apps that bear the same title with the very trademark in the business involved with different goods or services. Despite apps being categorized as “software”, in the context of services provided by nearly every branch of conventional industries being realized through apps on and by mobile terminals, the substance of services still resides in their content, subjects, and means. For instance, travel reservations and consultation offered by companies on apps should be classified as “travel service” rather than “software”. Therefore, it is believed to be inaccurate that app titles infringe upon other registered trademarks in Class 9 & 38 under all conditions.

In this case, the key to identifying infringement lies in the confirmation of whether the content of the services has constituted similarity with the designated service under the prior trademark. Since the plaintiff has registered service trademarks on “finance” in Class 36, the app title can be determined as to whether it has constituted infringement or not. It’s essential to grasp the association between the app and goods and service it provides amid identification of app trademark infringement, which can be a lesson for operators to look at the big picture in choosing appropriate titles for the apps. It requires them to be discreet when considering the use of titles from trademarks registered in Class 9 or designated on identical or similar goods or services, in a way to prevent and control the risk of trademark infringement. In addition to registrations in such core classes as 9 (computer software), 42 (software design and development), 38 (information transmission), application for trademark registration should simultaneously be instituted in other classes that are closely related to the goods or services. They are supposed to raise trademark protection awareness, plan, and prepare ahead and save against a rainy day.