Recently, the Intermediate People's Court of Linyi City of Shandong Province made the first-instance judgment over the case of Schneider Electric (China) Co. Ltd., represented by Unitalen, v. Shandong Schneider Transformer Co., Ltd. (now renamed as “Shandong Baoxiang Transformer Co., Ltd.”) and a related individual over the disputes of trademark right infringement and unfair competition. Unitalen helped Schneider Electric (China) won the first trial.
Schneider Electric (China) is a subsidiary of Schneider Electric, a Fortune 500 company. The defendant company Shandong Schneider was established on July 22, 2013, which do a similar business to Schneider Electric (China). In the bidding quotation submitted by the defendant to Linyi No. 3 Middle School on December 18, 2015, the information of Schneider Electric of France was used in brand introduction; And the registered trademarks of Schneider China, the relevant official documents and seals were submitted among the supplementary materials of the quotation to prove "industry qualifications" and "honor certification".
During the trial of the case, the defendant company submitted an application for change of its company name to “Shandong Baoxiang Transformer Co., Ltd.” on April 2, 2018 and was approved by the Administration of Industry and Commerce Department.
The Court’s Ruling
The Linyi Intermediate People's Court held that the defendant company has violated the exclusive rights of Schneider China's registered "Schneider" series trademarks in advertising, product sales and other business activities, and at the same time constituted false propaganda and unauthorized use of other company’s name that is with certain influence. It’s ordered to stop the aforementioned trademark infringement and unfair competition behaviors and compensate Schneider China for 300,000 yuan in economic losses and reasonable expenses.
The following highlights of the case are worth noting:
First, with the clues found during the advancement of the civil case, the legal representative of the defendant company was investigated by the police department and eventually sentenced with criminal charges.
Second, the defendant was forced to change its business name at the litigation stage, so as to avoid the large amount of time and cost that might incur during the execution of the judgment;
Third, in property preservation, we had exercised for the very first time the means of having “an insurance company to provide security for property preservation in the form of a letter of guarantee” in accordance with the “ Provisions of the Supreme People's Court on Several Issues concerning the Handling of Property Preservation Cases by the People's Courts”, which came into force on December 1, 2016, thus accumulating valuable practical experience for the firm to handle similar matters in the future.
The fourth is a successful attempt to uncover the veil of the defendant company and to determine the specific liabilities of the legal representative and the company.