‘Tort on an information network’ in TM infringement

By Li Mao, Boss & Young
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According to article 25 of the Interpretation of the Supreme People’s Court on the Application of the Civil Procedure Law of the People’s Republic of China, the place where a tort is committed on an information network shall include the place where the computer and other pieces of information equipment used to commit the alleged tort are located, and the place where the result of a tort occurs shall include the place of domicile of the victim.

Li MaoPartnerBoss & Young
Li Mao
Partner
Boss & Young

Therefore, for a tort that occurs on an information network, the trademark proprietors usually choose the court located in “the place of domicile of the victim” to bring a lawsuit.

Differing opinions

However, in judicial practice, courts of different places have different opinions for the definition of “tort on an information network”.

In one typical trademark infringement and unfair competition case, Foshan Nanhaibeihao Biotechnology Co Ltd v Tianjin Meizhilu Cosmetics Co Ltd, the court of first instance (Foshan Chancheng Court) held that online sales of counterfeit products does not constitute “tort on an information network” and thus the trademark proprietor could not choose the place of domicile of the victim as the competent court.

The Foshan Chancheng Court transferred this case to the First Intermediate People’s Court of Tianjin. Since the Tianjin Court took the opposite view, it requested the Supreme People’s Court (SPC) to deliver the final decision over the jurisdiction matter.

SPC ruling

Finally, the Supreme People’ Court made a ruling supporting Foshan Chancheng Court’s opinions and rendered its detailed analysis as following:

“The infringement of trademark right cases involves the protection of intangible property rights. The trademark rights and other affiliated rights can be circulated across the nation as the goods bearing those trademarks being sold nationwide. Thus, the determination of the place where a tort occurs is distinguishably different with that in those general traditional civil cases.

“In trademark infringement cases, except for those having the place where the infringing commodities are stored or sealed up and detained, only the place where a tort is committed, and where the defendant has his or her domicile, rather than the place where the result of a tort occurs, shall be the jurisdiction link point. Therefore ‘the place where the result of a tort occurs’ in article 25 of the interpretation of the Civil Procedure Law is not applicable to this case and the court, in ‘the place of domicile of the victim’ (Foshan Chancheng Court), shall not have the jurisdiction.”

Specific meanings

According to published cases, the prevailing views of courts in Beijing at various levels are that “tort on an information network” has specific meanings, which mainly refer to the publishing of information via the internet that “directly” infringes another’s legal rights, rather than all torts that occur on the internet.

However, the prevailing views of the courts in Shanghai, Jiangsu and Zhejiang are that online sales of counterfeit products shall also be deemed as “tort on an information internet”. Courts in other districts of China also hold different views over this issue.

Not all courts agree

According to the analysis above, not every court in China abides by the Supreme People’s Court’s opinions delivered in the case of Foshan Beihao v Tianjin Meizhilu regarding “tort on an information network”.

Therefore, a thorough case-by-case study before bringing such a lawsuit is of vital importance to trademark proprietors in evaluating and reducing the risks related to jurisdiction.

Li Mao is a partner at Boss & Young

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