SHANGHAI, CHINA (9 August 2007) — MWE China Law offices successfully defended the rights of the 3M Company (“3M”) in a high-profile case concerning the proper use of domain names and trademarks as well as unfair competition. The team from MWE China Law offices was led by partner John Huang and included Leon Liu and Simon Fang.
This is the first time 3M has been sued by a Chinese company in court over 3M’s domain name and it is the first time 3M has won a domain name in a Chinese court. Unlike a conventional infringement case (where a plaintiff typically attempts to prove that a defendant’s use constitutes infringement), in this case 3M was the named defendant when Jiangyan Rongcheng Abrasives & Grinding Tools Co., Ltd. (“Rongcheng”) brought a cause of action (“Que Ren Zhi Su”) against 3M in a local Jiangsu court. Rongcheng sought an action for confirmation by the Court affirming that its use of the domain name “rc3m.com” was non-infringing in nature with respect to the domain name “3m.com”.
This novel type of claim - a sort of “pre-emptive” defense for potential infringers -has only recently been introduced into Chinese law. Although the Taizhou Intermediate Court (“Taizhou Court”) initially agreed to hear Rongcheng’s complaint, MWE China successfully obtained a court motion to move the case to Shanghai No. 1 Intermediate Court (“Shanghai Court”) In the Shanghai Court, Rongcheng claimed that it successfully registered the domain name “rc3m.com” which is different from 3M’s trademark. The Shanghai Court, however, accepted MWE China’s arguments. Firstly, the Court found that Rongcheng’s usage of the domain name “rc3m.com” would be likely to create confusion, a mistake or deception in the minds of the relevant public. Secondly, because Rongcheng and 3M are business competitors, the court also found that Rongcheng knew or should have known that usage of “rc3m.com” would likely infringe upon 3M’s rights and therefore Rongcheng’s intent to use said domain name should be regarded as “malicious” which is one of the most difficult issues 3M has had to overcome.
After the receipt of the judgment from the Shanghai Court, Rongcheng immediately appealed to Shanghai High Court. With a thorough reviewing of the whole case, Shanghai High Court sustained the judgment from the first instance. To wit, 3M won the final judgment of the case.
Rongcheng is now legally prevented from using “rc3m.com” and this significant case exemplifies the successful use of the Chinese court system to protect the intellectual property assets of a multinational company.
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