Trademark Dispute Between Under Armour and Uncle Martian

The case concerning trademark infringement and unfair competition brought to Fujian Province Higher People’s Court by Under Armour Inc. (hereinafter the “Plaintiff”) against Fujian Tingfei Long Sporting Goods Co. (hereinafter the “Defendant”) bore fruit on June 19, 2017, after nearly a year of public hearing under common proceeding at the court of first instance since accepted on June 27, 2016 (Docket No.: (2016) Min-Min-Chu No. 78).

The dispute surrounds infringement on Under Armour Inc.’s registered trademarks in China, especially on the significant “UN” device mark. The Defendant’s “UM” logo is almost identical to its counterpart’s: a stylized letter “U” with an inverted “U” directly beneath it, only that they do not intersect like the “UN” logo. As soon as the Defendant debuted its new brand “UNCLE MARTIAN” with the “UM” logo, the Plaintiff quickly vowed to take action, saying it would “vigorously pursue” the “blatant infringement”.

Plaintiff’s claims

1. Trademarks of the “UN” logo, “UNDER ARMOUR” and “Andema” (transliteration of “Under Armour” in Chinese) owned by the Plaintiff are well known globally, including in China;
2. The Plaintiff has registered in China trademarks of the “UN” logo, “UNDER ARMOUR” and “Andema” on goods and services in Class 25, 28 and 35, and it is also the copyright owner of the original “UN” device mark;

Plaintiff’s registered trademarks in China

3. The device mark “UM” owned by the Defendant is similar to the Plaintiff’s “UN” regarding the main element and overall composition. They are designated on the same goods, reaching the same consumers via the same sales channel, and thus will cause confusion among the consumers. Therefore, use of the trademark “UM” constitutes infringement on the Plaintiff’s trademark rights. Meanwhile, general manager and shareholder Mr. HUANG Canlong of the Defendant has registered “Under Armour (China) Co., Limited” which was later renamed as “Uncle Martian (China) Co., Limited” (Co. No. 2352969 at Hong Kong Company Registry) in Hong Kong. In use, the registered company is displayed on the Defendant’s business cards in Chinese as “Andema (China) Co., Limited” with the Plaintiff’s registered trademark “Andema”. The trade name is likely to leave the consumer an impression that it is associated with the Plaintiff and thus constitutes unfair competition;
4. The Defendant is in obvious bad faith.

For the above reasons, the Plaintiff pleaded that the Defendant should: 1) immediately stop using TM “Uncle Martian” and device; 2) destroy the infringing products and relevant promotional materials; 3) award the plaintiff RMB100,000,000 (approx. USD $15 million) in compensation for what it pays to stop the infringement and eliminate reverse effects; 4) apologize to the Plaintiff; 5) undertake the litigation costs.

Defendant’s claims

1. The Plaintiff is hardly known in China;
2. TM “Uncle Martian” owned by the Defendant has been obtained from trademark assignment; the device mark has also been assigned as a separated part from an existing trademark and has been later registered. The device mark is quite different from the Plaintiff’s “UN” logo and is not likely to cause confusion, according to an online survey. Meanwhile, the Defendant has no substantive product on the market and de facto is not able to confuse the consumers. Furthermore, the Defendant uses the disputed trademark explicitly in the name of “Uncle Martian” with no mention of “Under Armour”. Therefore, the Defendant is in good faith using a distinguishable and legal trademark;

Defendant’s registered trademarks

3. As for registration by Mr. HUANG Canlong, he did it in his own name in no relation with the Defendant. In addition, the Law Against Unfair Competition of the People’s Republic of China is inapplicable in Hong Kong SAR regarding Mr. HUANG’s behavior;
4. There is no ground for the Plaintiff’s plead for compensation since the Defendant has never manufactured any relevant products;
5. There exists no trademark infringement and unfair competition since TM in use by the Defendant has been obtained from legal assignment and registration, and no substantive product has been manufactured up to the case hearing.

Opinions held by the court

Regarding trademark infringement: In spite of no substantive product, the Defendant has used the disputed trademark. The Defendant’s trademark device is designated on the same or similar goods with that of the Plaintiff which is relatively well-known in China. The two trademarks are similar with regards to the main element and the overall visual effect, which is of high possibility to confuse the relevant consumers in ordinary situations. The trademark actually in use by the Defendant is the uppercase “UNCLE MARTIAN” instead of the registered “Uncle Martian” which only capitalizes two initial letters. They are not completely the same and thus constituted “use of registered trademark under change of notable features” stipulated in Article 1 Paragraph 2 of the Provisions of the Supreme People’s Court on Issues Concerned in the Trial of Cases of Civil Disputes over the Conflict between Registered Trademark or Enterprise Name with Prior Right. Therefore, the case falls within the scope of civil proceeding. However, “UNCLE MARTIAN” is nothing near “UNDER ARMOUR” no matter in pronunciation or connotation. In all, the graphic trademark constitutes infringement whereas the textual one does not.

Regarding unfair competition: The existing evidence is insufficient to determine Mr. HUANG Canlong’s registration as related to the Defendant. However, by displaying the company as “Andema (China) Co., Limited” on the business card while realizing the Plaintiff’s trademarks and the Hong Kong company’s status, the Defendant obviously intends to capitalize on the Plaintiff’s reputation, misdirect the consumers and legitimately occupy the market proportion concerning the relevant products. Such behavior constitutes violation of business morals which highlight the principles of good faith and fair competition and also damages the Plaintiff’s interests. Therefore, the Defendant’s behavior constitutes unfair competition.

Regarding monetary compensation: The Plaintiff fails to prove the losses it has suffered or the Defendant’s gains from its infringement. Thus the monetary compensation is determined as RMB2 million (approx. USD $0.3 million), in consideration of the Plaintiff’s fame in China, the Defendant’s malicious intention, the sued behavior’s nature as trademark infringement and unfair competition, as well as the relevant expenses paid by the Plaintiff.

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