'Jiangxiaobai' is a phenomenal brand in the baijiu (white liquor) industry, and over the validity of trademark No. 10325554 'Jiangxiaobai', an administrative dispute went all the way to the Supreme People's Court. Guiding Case No. 162 made it clear: the existence of a distribution relationship does not equal an agency or representative relationship in the sense of the Trademark Law; where the trademark design and product design were originally created by the distributor and the principal had no prior use, the disputed trademark cannot be recognized as 'the principal's trademark' under Article 15.
Case Overview
The disputed trademark, No. 10325554 'Jiangxiaobai', was applied for on December 19, 2011 by Chengdu Geshang Advertising Co., Ltd. for alcoholic products in Class 33, and upon approval, the owner changed successively to Sichuan New Blueprint Trading Co., Ltd. and Chongqing Jiangxiaobai Liquor Co., Ltd. ('Jiangxiaobai Company').
On February 20, 2012, Chongqing Jiangjin District Sugar and Wine Co., Ltd. (including affiliated entities such as Jiangjin Distillery) signed a sales contract and a customized product sales contract with New Blueprint. The customized products covered by the authorization were customized products of the 'Jijiang' brand series and did not involve the 'Jiangxiaobai' trademark; the contract also stipulated clearly that product concept creativity, packaging design, and advertising planning were the responsibility of New Blueprint, and that Jiangjin Distillery could not use the relevant product concepts or advertising slogans for products sold by itself or other customers without New Blueprint's authorization.
In May 2016, Chongqing Jiangjin Distillery (Group) Co., Ltd. ('Jiangjin Distillery') filed a request for invalidation of the disputed trademark with the former TRAB under the State Administration for Industry and Commerce. The TRAB held that before the application date of the disputed trademark, the Jiangxiaobai Company ought to have known of Jiangjin Distillery's 'Jiangxiaobai' trademark, and that the registration constituted the circumstance referred to in Article 15 of the 2001 Trademark Law, ruling the trademark invalid. The Jiangxiaobai Company, dissatisfied, filed an administrative lawsuit.
Issues in Dispute
Jiangjin Distillery asserted that New Blueprint was its distributor, had designed the disputed trademark for it, and had used it first, so the registration violated Article 15 of the Trademark Law. The core issue was whether the existence of a distribution relationship sufficed to find that the disputed trademark was 'the principal's trademark'.
Judgments and Case Numbers
First instance: Beijing Intellectual Property Court, (2017) Jing 73 Xing Chu No. 1213 administrative judgment (December 25, 2017), vacating the TRAB's invalidation ruling and ordering a new ruling.
Second instance: Beijing Higher People's Court, (2018) Jing Xing Zhong No. 2122 administrative judgment (November 22, 2018), vacating the first-instance judgment and dismissing the Jiangxiaobai Company's claims.
Retrial: Supreme People's Court, (2019) Zui Gao Fa Xing Zai No. 224 administrative judgment (December 26, 2019), vacating the second-instance judgment and affirming the first-instance judgment—Jiangxiaobai Company prevailed and trademark No. 10325554 'Jiangxiaobai' was maintained. The Supreme People's Court held that although a distribution relationship existed, the trademark design, product design, and the like were all proposed by the agent's side; the customized product sales contract stipulated clearly that the principal could not use the product concepts or advertising slogans of the customized products without the agent's authorization; and the principal had no prior use—so the disputed trademark could not be found to be 'the principal's trademark' under Article 15.
The case was discussed and adopted by the adjudication committee of the Supreme People's Court and released on July 23, 2021 as Guiding Case No. 162 (source: guiding cases section of the Supreme People's Court official website).
Key Takeaways
- Article 15 requires more than 'a relationship': it also requires the premise of 'the principal's trademark', meaning the principal itself used or owned the sign first;
- Contract terms determine ownership: the customized product sales contract assigned the rights in product concepts, packaging design, and advertising slogans to the distributor, directly affecting the ownership finding;
- Brand creators should register early: here the trademark was first applied for by an advertising company and changed hands several times, and the lengthened chain of title amplified the risk.
Lessons for Businesses
In OEM and distribution cooperation, who creates the brand and to whom the brand belongs must be written clearly into the contract. A commissioning party should not take for granted that 'it is my product and my liquor, so the brand is mine'; a commissioned party or distributor that creates the brand through its own design should apply for registration in its own name at the first opportunity and keep creation evidence such as design drafts, promotional plans, and packaging print orders. If a brand owner wants to control the trademark, the cooperation contract should stipulate the ownership of the trademark application and the obligation to assign.
To engage the services described above, you may submit an invalidation request on MyTMBee, and a filed trademark agent will follow up.