Burberry – China’s Latest Trademark Victim?

November 29, 2013

You might have read headlines saying that Burberry had lost its trademark rights in China. Not quite. Yes, it is embroiled in a complicated, but familiar, trademark dispute with a competitor, but it’s a bit early to close the book on this one.

The backstory here is that Burberry has been fighting with a Taiwanese competitor for nearly a decade. These guys use a similar tartan pattern on their products (you can be the judge regarding the similarity) and have not been all that successful with this IP struggle thus far:

Until this month, Polo Santa Roberta had trouble convincing officials in other venues of the merits of its argument. The maker of handbags and clothing often sporting tartan  lost a dispute with Burberry in 2010 in a Hong Kong court. The judgment concluded that Polo Santa Roberta’s designs “were not novel at the time of registration” and revoked them from the city’s designs registry. (WSJ)

Hmm. Sounds like these guys went and filed a design. Novelty is a patent issue, and has nothing to do with trademark, so I bet that they went the design route because Burberry had already filed its mark in HK. Sneaky devils.

After losing that case, they hit upon the old 3-year non-use cancellation gambit. Good tactic, as it turns out. The law here has a “use it or lose it” provision, and anyone can challenge any registered mark on this basis.

The Reuters write-up of this leaves a lot to be desired:

China’s trademark office recently pulled patent protection for the camel, red and black check tartan on Burberry’s leather goods, although the change will not come into effect until the appeal is heard, the company said.

The cancellation of the trademark, which would otherwise have run until 2020, was because Burberry has not made use of the specific tartan pattern in China for three years, according to the trademark office website.

Yeah, well, actually the Trademark Office can’t invalidate a patent. Of course, there wasn’t a patent involved in this case, so I have no idea what the Reuters reporter is talking about. Also not sure why they bothered to mention that the trademark was scheduled to run until 2020; trademarks (not patents!) can be renewed, so the current registration period doesn’t mean all that much here.

So is this a big deal for Burberry? Sort of. First, keep in mind that the case is pending appeal, and even if they lose at the Trademark Review and Adjudication Board, they can still appeal that administrative decision at the intermediate court level here in Beijing. Second, this is one pattern (they have more than one, right?) and the mark only applies to leather goods. Third, I do have some concerns with the underlying non-use cancellation case. That’s a VERY easy case to win for trademark owners; all you need to do is submit evidence of usage, and the bar there is extremely low. I believe even a simple advertisement would have sufficed.

Never say never, but if Burberry lost the cancellation action, it’s difficult to imagine what the appeal will be about. Keep in mind, of course, that we don’t have all the details, although some of the commentary on this is clearly irrelevant. The Taiwanese company’s lawyer, for example, seems to think that the question of distinctiveness has a bearing on the non-use action (it doesn’t):

“The check pattern is just a simple geometric pattern. I don’t think Burberry has the right to keep it exclusively and ban other producers from using it,” said Mr. Chen.

Weird. And a completely useless statement.

Yet another China trademark case that is totally different from what the headlines would suggest. I sense a pattern here, and it’s not a tartan.