Backstage at Ermenegildo Zegna Men's Spring 2019

MILAN The People’s Republic of China’s highest judicial authority, the Supreme People’s Court, or SPC, has put an end to a five-year dispute between Ermenegildo Zegna and a local Chinese company manufacturing and distributing men’s wear clothing and accessories under the trademark “Yves Zegnoa.”

For the first time, said the Italian men’s wear firm, the SPC has ruled against infringement of the intellectual property rights in favor of a non-Chinese company based on the bad faith use of the infringer’s registered trademarks.

“This judgement is very significant,” said Gildo Zegna, chief executive officer of the Ermenegildo Zegna Group, “not only because it supports our intellectual property rights in China in consideration of the high fame and reputation that our trademarks gained, but principally because it confirms the recent positive efforts of the Chinese courts in protecting the fair competition in view of a local market ruled in the interest of all local and international players present in the Chinese territory.”

Zegna noted the SPC also supported its claims in light of the group’s solid and established presence in China spanning more than three decades. It also emphasized “the circumstances of the similarity and bad faith use of the ‘Yves Zegnoa’ trademark, trying to imitate the Italian brand, particularly considering that the Chinese registrant had on many occasions been prominently highlighting the latter part of ‘Zegnoa’ in an obvious attempt to imitate and create confusion with ‘Zegna’ amongst Chinese consumers.”

The highest court overturned earlier decisions at lower judicial levels “and included post-registration use as an element to be considered in determining trademarks’ similarity and violation of other’s high fame, reputation and intellectual property rights,” concluded Zegna.

In April, commenting on a 64 percent spike in net profits last year to 32.8 million euros, on the back of sales of 1.18 billion euros, the executive said Mainland China accounted for one-third of the group’s business.

China has been getting increasingly serious on protecting foreign brands’ intellectual property. Earlier this month, Alfred Dunhill was awarded 10 million renminbi, or $1.44 million, following a Guangdong Province court ruling that men’s wear brand Danhuoli was guilty of trademark infringement and unfair competition practice.

The case was heard by Foshan Intermediate People’s Court and centered on Danhuoli’s logo, which featured tall, stretched-out letters, in black and white and all lowercase, imitating the “long tail mark” of the Dunhill logo. In its ruling, the court also deemed that the individual responsible for the company was personally liable for the infringement, adding a further dissuasive element to intellectual property infringement in the country, according to Dunhill. Alibaba has recently campaigned to clamp down on counterfeits and, in August, New Balance touted a $1.5 million win in its latest trademark case in China, which it claimed was the largest payout to a foreign firm in the country ever.

Developments earlier this year included Salvatore Ferragamo’s recovery or cancellation of 140 domain names and illegal web sites, mainly managed by Chinese individuals, and the seizure and destruction of more than 12,500 counterfeit products. Chinese customs authorities confiscated more than 12,400 fake Ferragamo goods leaving the country and seized more than 34,000 counterfeit products in 2015. The estimated value of the goods exceeded $17 million. Over the years, Ferragamo has won around 10 civil court cases against respondents involved in illegal activities, and in 2013, it succeeded in shutting 400 illicit web sites.

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