Global Review Counterfeit and Piracy 2008: "Production Infringing Goods Is Still Increasing"

The World Customs Organization (WCO) has launched its annual report for 2008, read the Global Review on Counterfeit and Piracy here.

Kunio Mikuriya, secretary general of WCO wrote:

"The results reported by Members during 2008 for combating counterfeiting and piracy are the best ever published. While we can commend the exemplary work doneby Customs administrations and a real effort by Members world-wide to eradicate these fraudulent activities, the statistics for 2008 are also noteworthy for another reason: the production of goods which infringe intellectual property rights is still increasing, thereby posing an ever-greater threat to the health and safety of consumers on every continent, and to artistic and industrial design in countries around the world."

Hu Jintao's Serious Words About Innovation and IPR in China: "Treasure As Your Life"

Innovation is for each country crucial to compete. Now China's Harmony Express, the world's fastest long-distance passenger train service between Guangzhou (廣州) and Wuhan (武漢) has just been launched and is with 350 kilometers per hour 50 kilometers per hour faster than Japan's Shinkansen bullet train and France's TGVs. Read Tom Mitchell's article for FT here. Therefore it is no wonder that China's president Hu Jintao (胡錦濤) is urging local companies to put a lot of efforts in innovation.

At a Zhuhai (珠海) software company, cited by CCTV via China IPR he even said : "Nowadays, the competition in information technology is extremely fierce. I hope you, as a software company, will treasure technological innovation as your life. You need to own intellectual property rights for your products. I hope you will be pioneers in the development of our country's software industry."

Read here.

No, I Don't Believe the Starbucks' counsel Who Said: "Chinese Customers Refill Cup With Coffee From Other Brands"

Mark Aoki-Fordham, director and corporate counsel at Starbucks Coffee Company said something ... well outlandish:

“We are still trying to educate Chinese customers about why our coffee is a good beverage to drink at all times of day -- and we’ve found that they are not the most loyal,” Aoki-Fordham noted. “They love our brand; they’ll come in and buy a cup of coffee, and they’ll keep the cup with our logo facing forward as they walk, but they’ll refill it throughout the day with other brands of coffee!”

If you buy a cup of coffee from another brand you will get it in a cup from that brand. Then it is just too much of a hassle to change the caffeinated liquid to the Starbucks cup.
So I don't believe that Chinese customers are trademark counterfeiters on a not so commercial scale. Do you believe him?

Read the Knowledge Wharton Marketing article called 'From Venti Lattes to Spider-Man: Adapting Global Brands for Success in China and India' here.

Microsofts' MSN Juku Infringes Plurk and Apologises

MSN Juku, Microsoft's micro-blogging site in China, admitted that that it has infringed the copyright of Plurk, which is popular in Taiwan and the Philipines but is blocked in the PRC.

Read relevant articles at the Plurk's blog:
- Microsoft China rips off Asia's No. 1 Microblogging Service
- Plurk's official response to Microsoft's apology

Read the Financial Times article by David Gelles about it here. Head tip to McGill's CIPP Jeff Robert's IP News This Week.

Shanda Literature Ltd Sues Baidu For Alleged Copyright Infringement

Xie Yu reports for China Daily about Shanda Literature Limited's lawsuit against Baidu for alledged copyright piracy. Read more here.

Appellate Body Report in Sino-American Dispute about Market Access for Copyrighted Products

Yesterday, it was announced that the Report of the Appellate Body in China – Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products, WT/DS363/AB/R was published. The three Members of the Appellate Body who served on this appeal were:

Ms. Jennifer Hillman, as Presiding Member, Mr. Shotaro Oshima and Mr. Ricardo Ramírez-Hernández.

You can download the 183 pg report here (see on your right hand side 'All documents').
I have not read the whole thing yet, but according to the Financial Times the report has the following conclusion:

• The Appeals Body upheld the Dispute Panel Body ruling that restrictions on imports of US films and music are not allowed under WTO;
• US and other foreign companies should be allowed to import films, music and books into China, rather than through state-owned entities;
• US and other foreign companies should be permitted joint ventures with Chinese companies to dirstribute music over the internet;
• The right to censor foreign films and publications is not challenged, nor the Chinese quota 20 foreign movies a year.

The relation between market access and copyright infringement is simply that market access restrictions for copyrighted products will create demand for copyright piracy.

Giorgio Armani Not Amused By Giormani of Hong Kong

IP Dragon was strolling in Sha Tin (沙田), minding his own business, until he came across a Giormani shop. Was Giorgio Armani saving costs by using less lettering on the billboards?

Italian designer Giorgio Armani, who built the vast Emporio Armani (empire Armani) of clothing and luxury products, will probably not be amused that Kelvin Ng and Jane Tong founded Giormani, a Hong Kong sofa furniture design and manufacturing company in 1999. It's website tells you that they work with young designers from Italy, Germany and Hong Kong. Therefore, we can exclude the possibility of Giorgio Armani designing for them, since he is only young at heart.

If Giorgio Armani registered its trademark in Hong Kong he could probably do something about the sofa business. And even when he did not register his trademark, since Hong Kong has a Common Law system, it means that he can enforce his unregistered trademarks with the legal figure of the tort of passing off.

However the plaintiff should proof the classic trinity:
The goods or services have acquired goodwill or reputation in the marketplace that distinguishes such goods or services from competitors;
The defendant misrepresents his goods or services, either intentionally or unintentionally, so that the public may have the impression that the offered goods or services are those of the claimant;
and The claimant may suffer damages because of the misrepresentation.

The Trademark Ordinance of Hong Kong states in the introduction: "No proceedings lie to prevent, or to recover damages for, the infringement of an unregistered trade mark butnothing in this Ordinance affects the law relating to passing off."

Shanghai's "Bad Girl" Writer Mian Mian (棉棉) Sues Google

The writer of the banned book Candy, and, Panda Sex (according to China Daily more mature) and Acid Love, sues Google.
Shanghai's "Best Bad Girl" Author Mian Mian (棉棉), finds support from the China Written Works Copyright Society.

Chen Jia en Xie Yu of China Daily report:

"Mian said Google scanned her entire novel, titled Acid Lover, published by the Shanghai Joint Publishing Company, without notifying her or paying her for copyright permission. Google China deleted Mian's Acid Lover from their website on Nov 15. But she said a Google key-word search still brings up passages of her book."

So now not only the China Written Works Copyright Society, see here, and the Chinese Writers Association are negociating with Google about the Google Class Action Settlement over Google Books, but an individual has sued the company based in Mountain View, California, as well.

Read the China Daily article here.

China's Protectionism Promotes Chinese Patents

IP Dragon's friend Peter Ollier of Managing Intellectual Property reports about the 'Instructions for National Indigenous Innovation Product Application Procedures', promulgated by the Ministry of Science and Technology and the National Center for Science and Technology in September 2009. See Mr Ollier's MIP article here.

In the Third Amendment to China's Patent Law of 2008, China got rid of the requirement that if you want a patent outside China of an invention that was done in China, you first needed to file the patent in China. However, what was the replacement? Article 20 Patent Law 2008 demands a "mandatory advance confidentiality examination" as the IPR2 writers of the excellent booklet 'Third Revision of China's Patent Law' call it, before a patent can be filed abroad; to prevent so called national security issues, has its own disadvantages, about which I will elaborate upon later.
Level Playing Field
China devised the following accreditation principles:

"1. Products should be of great significance. The accredited products must contribute much to or can produce vital influence on the economic and social development;
2. Products should be proprietary. The accredited products must have Chinese intellectual property and proprietary brands, and the ownership and the right of use are clearly defined, without producing disputes;
3. Products should be symbolic. The accredited products must be symbolic products mirroring China’s indigenous innovation capabilities and levels."

So: Economically significant products (vague terms), that are protected by Chinese intellectual property rights. However, the last sentence that the products should mirror China's indigineous innovation capabilities and levels, shows that China will make use of Chinese alternatives if they are available. Read the 'Instructions' translated by US Information Technology Office (a US Government institute that is for example is involved in 'Ruled for Formulating Standards Involving Patents), here.

Photo/Text: Danny Friedmann

Prof Potter about China's Health Care Reform: "Do Not Forget Cost of Patent Protection"

December 10 and 11, 2009, IP Dragon attended interesting seminar called 'The Development of the Chinese Legal System: Change & Challenges' organised by the Centre for Chinese Law of the University of Hong Kong.

Law Professor Pitman Potter of the University of British Columbia was talking about his upcoming paper "China's Health Care Policy". It's about how the National Human Rights Action Plan of China and China's Health Care Reform Guidelines fail to take into account the rising costs of drugs and the descending level of access to medicines in China, because of patent protection and enforcement. In the paper the role of the Doha Declaration, as an interpretation on the flexibilities of the Agreement on Trade and Intellectual Property Rights, will come to the fore. So stay tuned for Professor Potter's paper.

UPDATE May 19, 2010: Professor Potter's paper is 'Dilemmas of Access to Healthcare in China', published in China: an International Journal 8, 1, March 2010, pp 164-179.

Another interesting presentation was given by Law Professor Donald Clarke, who is connected to the George Washington University Law School. His presentation was about "The Concept of the Extra-Legal in Chinese Law and Its Significance". Professor Clarke was making the point that scholars who were either focusing on the differences or the similarities between China and the rest of the world, might miss the point. Professor Clarke said that the discussion about whether China's legal system is mature or immature is a bit ridiculous, because nobody knows what the end stage is going to look like. And of course it is not strange that China, given its different background, comes up with a different legal system. His main point was that China's legal system has different layers, which could each be observed:

1. the factual claim, if a norm is violated;

2. the norm, which is saying that it is illegal to violate a norm;

3. this layer is the meta-layer and is about the legal system game itself.

Media Control Not Copyright Piracy Main Reason For China's Battle Against BitTorrent

Frederik Borgesius (research master at IViR, studying copyright law and internet law for a semester at the University of Hong Kong, paralegal at solv.nl, a Dutch IP & IT boutique law firm, and "dj Fred" by night at Yumla for example) sent IP Dragon an interesting link.

It's about China's aggressive stance against BitTorrent sites. In some countries BitTorrent sites are shut down. Mainly because of copyright piracy. In China the most important reason seems to be control over the media; China’s State Administration of Radio Film and Television (SARFT) concern is video websites that lack appropriate licensing and certification by the government, allegedly damaging children's minds and undermining national security. Read TorrentFreak's article by enigmax, here.

Starbucks Is Coming From Venus, Copycats from St. Mars

Jamon Yerger is founder of Southern Perspective Shenzhen ("China Law Reference, doing it right the first time"), a consulting company in the bustling city of Shenzhen that provides advice on a range of business functions; the majority of which deal with manufacturing in China and legal protection for foreign companies engaged in supply chain activities. Mr Yerger wanted to go to a Starbucks. And he did not mean Starbucks in the generic sense, as some people already use it for any place where you can buy a daily doses of caffeine. Although "colors, script, umbrellas and even the glass awning over the doors" were similar to his old Starbucks, he found out, to his surprise, it was not coffee shop of this also in China pretty well known brand (I am not referring to the legal term well known mark. This would be the case if it is well known in China, and acknowledged as such by China). They only used a different name: St. Mars. So the place had the look and feel of Starbucks. IP Dragon agrees with Mr Yerger's opinion that St. Mars is "clearly hitchhiking" on the Starbucks brand. So what could it mean in legalese?

The question is whether Starbucks registered the name Starbucks Coffee in China. If you are at the trademark search site, sponsored by the Trademark Office of the State Administration for Industry and Commerce (first select "Search of identical or similar TMs", then fill in class 30 for non-alcoholic beverages), here, you will find that Starbucks has several trademarks. You could then argue that Starbucks Coffee and St Mars Coffee, using the identical font, and the identical colour, is confusingly similar and infringes Starbucks trademark. Maybe Starbucks separately trademarked the colour, which would lead to trademark infringement. The design of parts of the place could be patented in China. And if the copycat cannot be stopped by trademark law or design patents, copyright law might be a place of last resort. China is coming up with a Tort Law (December 5th, was the deadline for submission of comments), see here, and maybe the legal figure of passing off will be introduced, which I doubt, since it is more of a Common Law legal figure. Anyways read Mr Yerger's article, see the pictures of the two places and decide for yourself here.

Read also Starbucks versus Xingbake here.