Is There a Squatter on My China Trademark and if There is What Should I Do?

A number of Chinese trademark law firms (and non-law firm service providers) have of late been trying to drum up American clients on China trademark matters. I say this because my firm’s China trademark lawyers have been getting a steady stream of emails from U.S. lawyers and companies contacted by these Chinese trademark law firms. The Chinese law firms are writing to U.S. lawyers and companies to alert them of trademark filings in China of the same trademarks owned by the company in the United States. These emails from the Chinese trademark attorneys to U.S. trademark attorneys usually go as follows:

We, _________ are a specialized Chinese IP law firm. Our trademark research team took note of the following marks from a recent issue of the Chinese Trademark Gazette published on May 6, 2022, open to oppositions before August 6, 2022, Beijing time, NOT extendable. Particulars of the marks are listed below for your reference.

For your information, we, ______ IP, are a Chinese IP law firm and member of various international organizations, including INTA, ____, ____, ____. The majority of our clients are based in China, which enables us to regularly send business to our foreign associates. We will be more than pleased to establish reciprocal relationship with your esteemed firm.

We look forward to your reply. If you are NOT interested in our reporting emails of this type, please feel free to let us know via return and we will refrain from bothering you any more, your understanding is highly appreciated.

The U.S. lawyers — oftentimes not knowing whether the email they just received is a scam or not — write my law firm’s lawyers asking what is going on and what their client should do. Our response is usually something like the following:

1. Yes, something is actually happening with the marks in China. On December 14, 2021, the Chinese company _______ Outdoor Supplies Co., Ltd. filed applications for the stylized “_________” mark in Class 7. I have attached copies of the relevant trademark information. Though it’s in Chinese you can see that the stylized mark is an exact copy of your client’s. The mark has been approved by the CTMO examiners and was published in the May 6, 2022 edition of the Trademark Gazette. If three months pass and no one files an opposition, the mark will proceed to registration.

2. Your client could indeed file an opposition to the mark. The chances of a successful opposition will depend on the facts. China is a first-to-file jurisdiction and the grounds for a bad-faith filing are limited. It is unlikely your client’s mark would be considered “well-known” enough to convince the CTMO that these filings were in bad faith. But China has been taking a harder line on trademark squatters. In any case, filing an opposition is relatively inexpensive.

In this instance, it does not appear the Chinese company is a trademark squatter per se; they only have two other trademarks (both registered) in their name. My guess is they actually intend to use your client’s mark in China to market or sell their own goods.

Your client has the following options at this point:

a. File an opposition to the cited marks. If this mark is important to your client and they understand the low odds of success, they probably should do this, in large part because the costs of their doing so are so low.

b. Contact the Chinese company and attempt to purchase the mark.

c. Wait three years to see what, if anything, the Chinese side does with the mark. As you perhaps already know, if the mark has not been used in commerce for three years it can be cancelled for non-use. See China Trademarks: When (and How) to Prove Use of a Mark in Commerce.

Whatever you do, please do not use the Chinese law firm that sent the email. I request this because many of these law firms hang back and register foreign company trademarks only after the foreign company reveals concern about the email.

Please let me know if you have any questions or would like to discuss further.

The real key is what we are always saying here on this blog: Register your trademarks in China. Like today.