Newsletter
The Intellectual Property Court Provides Guidance on the Factors to Determine "Well-Known Symbol" for Product Design under the Fair Trade Act
Under the current legal regime in Taiwan, product design may be protected by intellectual property rights such as trademark, design patent or copyright. In addition, product design that has not obtained trademark registration may also be protected as "well-known symbol" under the Fair Trade Act.
According to Article 22 of the amended Fair Trade Act, as promulgated on February 4, 2015, no enterprise shall use a "well-known symbol" of goods or services, which is not a registered trademark, for “the same or similar” goods or services so as to cause confusion. Based on Article 22, the right holder of the "well-known symbol" may bring a civil claim for damages. However, unlike the above mentioned intellectual property rights such as trademark, design patent or copyright, the determination of the "well-known symbol" status is rather unclear in practice. In a recent Fair Trade Act violation case, the Intellectual Property Court had expressed its view on how to determine "well-known symbol" for product design under the Fair Trade Act.
The plaintiff of this case was a German luggage manufacturer which was famous for its groove design of suitcases. The plaintiff claimed that that the defendant used an identical or highly similar design on its suitcases and had violated Article 22 of the Fair Trade Act. The defendant argued that, the "groove design" claimed by the plaintiff was functional and should not be deemed as a protectable "well-known symbol" under the Fair Trade Act. The defendant further pointed out that, even though the "groove design" had obtained trademark or trade dress registration in jurisdictions such as United States, European Union and Germany, the Plaintiff's trademark application was rejected in Taiwan. In addition, the defendant claimed that there were numbers of business that had been using the same or similar groove design in the past 10 years.
With respect to the arguments of both parties, the Intellectual Property Court firstly clarified that, the purpose of the protection of "well-known symbol" under Article 22 of the Fair Trade Act is promote fair competition of the marketplace and not related to functionality of the symbols.
The Court further specified that, in determination of "well-known symbol" status, the following factors may be used as reference: (1) the strength of the "groove design" (2) Whether the plaintiff consistently conveyed the concept of the "groove design" (3) the advertising and promotion of the "groove design" (4) the sales and brand image of the "groove design" (5) the media coverage of the "groove design" (6) the recognition of well-known status of the "groove design" in Asian countries (7) the trademark registration in major jurisdictions (8) the plaintiff did not argue the "well-known symbol status" in other related cases. Based on the above factors, the Court held that the "groove design" of the Plaintiff should be protected as "well-known symbol" under the Fair Trade Act.
On a separate note, the Court pointed out that, even though Taiwan Intellectual Property Office had rejected the Plaintiff's trademark application of the "groove design", the plaintiff voluntarily withdrawn the application afterwards. Taiwan Intellectual Property Office did not make a final decision on the registrability of the "groove design". As a result, the fact that the Taiwan Intellectual Property Office made a preliminary rejection over the Plaintiff's trademark application should not be a sufficient basis to deny the "well-known symbol" status for the "groove design".