President-elect Donald Trump has joined the ranks of celebrities such as Allen Iverson, Michael Jordan -and even James Bond (!)- in taking up the hatchet against China’s notorious trademark squatters. These trademark squatters typically use and abuse the first-to-file rule: i.e. the first person to file for a mark (and not use a mark, like in the USA), owns it. This first-to-file-rule is not unique to China, it is also the law of the land in many other major jurisdictions such as the EU. The Trump-trademark case is interesting because it is a typical example of how trademark squatting works in China, and how it can be fought and defeated.
In 2006, Trump filed a trademark application in China for the “TRUMP”-mark in class 37 (Building construction etc.). However, less than one month before Trump’s application was filed, a Chinese individual (allegedly a trademark squatter) had already applied for the same mark in a subclass of class 37 (for services such as “building construction supervision“). In November 2009, China’s Trademark Bureau made a straightforward application of the first-to-file rule, and brushed Trump’s trademark application aside.
Trump then appealed this decision to the Trademark Review and Adjudication Board (TRAB). The TRAB upheld the Trademark Bureau’s finding. Trump then appealed this ruling to both the Beijing Intermediate People’s Court and then to the Beijing Higher People’s Court, where he lost each time on the basis of the first-to-file rule.
Trump then adopted a new strategy: he let the squatter’s TRUMP mark proceed to registration, filed his own new set of new applications in several classes including 37, and started an administrative invalidation action against the squatter’s -now registered- mark. In the invalidation procedure, Trump claimed that “TRUMP” was a well-known mark in China, which should be protected regardless of registration and class boundaries.
Victory at last?
In a surprising -yet unpublished- decision, issued over the summer of 2016, the TRAB finally rewarded Trump for his relentless attempts, and invalidated the squatter’s TRUMP-mark for real estate services.
The unanswered question remains: why did the TRAB invalidate the squatter’s mark, which had an earlier filing date? One possibility is that the TRAB took the enormous Chinese media attention for Trump’s election campaign into account, which may have influenced the TRAB’s view on the fame of the TRUMP-mark in China. Another possibility is that the TRAB applied an informal internal rule protecting the name of important international politicians (precedents exist for the Chinese versions of e.g. ‘Clinton’, ‘Obama’ and even ‘Hillary’) from trademark squatting.
It will be interesting to see how future Trump-squatting cases will be handled. The Chinese trademark register currently contains over 50 trademarks containing “Trump”, only 21 of which seem to belong to the new President-Elect. It seems like the hatchet is not buried yet. We will keep you posted.