Final Administrative Judgment — UDZ Technology (Beijing) Co., Ltd.; trademark-refusal appeal dismissed

Administrative Judgment

Appellant (plaintiff at first instance): UDZ Technology (Beijing) Co., Ltd., domiciled at Room 2953, 29th Floor, Block C, No. Jia 6 Jianguomenwai Avenue, Chaoyang District, Beijing.

Legal representative: Zhang**, manager.

Authorized representative: Liu Fan, lawyer at Hebei Shengyu Law Firm.

Respondent (defendant at first instance): Trademark Review and Adjudication Board of the State Administration for Industry and Commerce, domiciled at No. 1 Chama South Street, Xicheng District, Beijing.

Legal representative: Zhao Gang, director.

Authorized representative: Tian**, examiner of the Trademark Review and Adjudication Board of the State Administration for Industry and Commerce.

The appellant, UDZ Technology (Beijing) Co., Ltd. (the “UDZ Company”), appealed to this Court against Administrative Judgment (2016) Jing 73 Xing Chu No. 1926 of the Beijing Intellectual Property Court in an administrative dispute over review of the refusal of a trademark application. After accepting the case on 8 September 2016, this Court constituted a collegiate panel in accordance with the law and heard the case. The proceedings have now concluded.

The Beijing Intellectual Property Court considered that the disputed trademark consists of the Chinese characters “优定制.” “定制” means “making a particular thing according to a customer’s specific requirements” and, in relation to goods such as “clothing,” has the meaning “tailoring for an individual customer.” Thus, “定制” directly indicates a characteristic of the manufacture of “clothing.” The Chinese character “优” means “fine” or “outstanding”; combining it with “定制” to form the trademark does not confer the distinctiveness required for registration. Accordingly, the disputed trademark, “优定制,” directly indicates a characteristic of the manufacture of “clothing,” lacks distinctiveness, and is a sign that may not be registered as a trademark under Article 11, paragraph 1, item (2), of the Trademark Law of the People’s Republic of China (the “Trademark Law”). The evidence submitted by the UDZ Company is insufficient to show that, through use in relation to the designated goods, the disputed trademark has acquired the distinctiveness required for registration. Accordingly, pursuant to Article 69 of the Administrative Litigation Law of the People’s Republic of China, the court gave judgment dismissing the UDZ Company’s claims.

The UDZ Company, dissatisfied with the first-instance judgment, appealed to this Court and requested revocation of both that judgment and the challenged decision. Its principal ground of appeal was that the disputed trademark possesses distinctiveness and should be approved for registration.

Having heard the case, the Court finds as follows:

I. The disputed trademark

1. Applicant: the UDZ Company.

2. Application No.: 15757806.

3. Application date: 21 November 2014.

4. Sign:

Designated goods (Class 25, Groups 2501–2505 and 2507–2512): work clothes; ready-made clothing; clothing; baby trousers (clothing); shoes (footwear); hats; socks; gloves (clothing); neckties; scarves; suit pocket squares; belts.

II. Challenged decision: Shang Ping Zi [2016] No. 12873, Decision on Review of Refusal of Trademark No. 15757806, “优定制及图” (“优定制” and device).

Date of the challenged decision: 17 February 2016.

The Trademark Review and Adjudication Board of the State Administration for Industry and Commerce issued the challenged decision, refusing the registration application for the disputed trademark, on the ground that it fell within Article 11, paragraph 1, item (3), of the Trademark Law.

III. Other facts

During these proceedings, the UDZ Company submitted three items of evidence, primarily to establish that the disputed trademark had acquired a degree of recognition through use and possessed the distinctiveness required for trademark registration.

The foregoing facts are supported in the record by the file for the disputed trademark, the challenged decision, the evidence submitted by the parties, and other materials.

This Court considers as follows: Article 11, paragraph 1, item (2), of the Trademark Law provides that signs which merely directly indicate the quality, principal raw materials, function, purpose, weight, quantity, or other characteristics of goods shall not be registered as trademarks. Item (3) provides that signs lacking distinctive characteristics shall not be registered as trademarks. A trademark is a sign used to identify and distinguish the source of goods and services. Whether a sign may be registered as a trademark depends on whether it performs the identifying function of distinguishing the source of goods or services. If the relevant public would not recognize a sign as one that distinguishes the source of goods or services, then, in principle, the sign lacks distinctive characteristics and cannot be registered as a trademark. In terms of a trademark’s identifying and distinguishing functions, a sign will distinguish between different providers of identical or similar goods and services only if the relevant public first recognizes and treats it as a sign indicating the source of goods or services. The identifying function in trademark distinctiveness precedes the distinguishing function. In this case, the sign of the disputed trademark consists of

“优定制及图” (“优定制” and device). “定制” is an established expression, and “优” means “fine” or “excellent.” When “优” and “定制” are combined and used for clothing and other goods in Class 25, the relevant public is unlikely to recognize the sign as a trademark that distinguishes the source of goods. Accordingly, the disputed sign itself lacks the distinctive characteristics a trademark should possess. The first-instance judgment’s application of Article 11, paragraph 1, item (2), of the Trademark Law to this case was an error of law, which this Court corrects.

Article 11, paragraph 2, of the Trademark Law provides that signs listed in the preceding paragraph may be registered as trademarks if they have acquired distinctive characteristics through use and are readily identifiable. In this case, the evidence submitted by the UDZ Company is insufficient to establish that the disputed trademark has acquired distinctiveness through use. The challenged decision correctly concluded that the trademark applied for lacked distinctiveness, and this Court upholds that conclusion. The UDZ Company’s related grounds of appeal cannot be sustained, and this Court does not uphold them.

In conclusion, although the first-instance judgment erred in its application of the law, its conclusion was correct, and this Court upholds it. The UDZ Company’s grounds of appeal lack a factual and legal basis, and this Court does not uphold its appeal requests. Pursuant to Article 89, paragraph 1, item (1), of the Administrative Litigation Law of the People’s Republic of China, this Court gives judgment as follows:

The appeal is dismissed, and the first-instance judgment is upheld.

The case acceptance fees at first and second instance, each RMB 100, shall both be borne by UDZ Technology (Beijing) Co., Ltd. (Both already paid.)

This judgment is final.

22 November 2016