When news emerged last month that Burberry had lost the trademark for its signature pattern in China, it wasn’t a huge surprise. Although seen on the lining of bags and trench coats, we’ve seen very little of the trademark check in recent years. After a number of ill advised licensing agreements resulted in the adoption of the check as the uniform of chavs, football hooligans and the cast of Eastenders, the company appears to have actively, and very successfully, moved away from its signature print.
Unfortunately for Burberry, this may have cost them the use of the trademark altogether in relation to leather goods in China, where requirements regarding the active use of trademarks are stricter than they are here in the UK. While UK trademarks can be revoked if they are not used within five years of their registration or for a consecutive five year period at any time afterwards, the time period in China is just three years.
Road Bi Damaqiu Leather Product Limited Company, who had been sued by Burberry on numerous occasions for trademark infringement, applied to have the trademark revoked on the grounds that it had not been used for three years. The Chinese Trademark Office agreed, and cancelled the Burberry trademark. Road Bi Damaqiu wasted no time and filed suit against Burberry, seeking $82 million, the total losses that the company suffered from Burberry’s trademark related lawsuits!
As Burberry have filed an appeal, the matter is far from settled. However, although a legal nightmare for Burberry, it’s another important lesson for other brands seeking to expand into China. The lesson is clear – you need to use it or lose it! That’s of course, if you can get the trademark in the first place.
As many designers expand into China, they are discovering that their names have already been registered as trademarks by individuals hoping to extort money from them. The cost of registering a trademark in China costs in the region of £2000 but many designers are paying between £100,000 and £150,000 to buy their name from squatters. If a designer cannot demonstrate that they have a sufficient global reputation in China to supersede the third-party trademark, or prove the trademark had not been used, then they either have to consider using a different name in China or pay to regain their rights to the name.
Earlier this year, when designer Phillip Lim discovered that his name had been already registered in China by trademark squatters, he refused to give in. Instead, he introduced a dedicated brand mark for any ready-to-wear and footwear
Further problems suffered by designers can arise if a Chinese firm has registered the name in a different category, resulting in designers facing the prospect of sharing its name. One Chinese business is reportedly making underwear under the label of Theo Fennell, the name of the renowned London jewellery designer.
Both the British Fashion Council (BFC) and UK Fashion & Textile Association (UKFT) have been made aware of the problem and are working with the China-Britain Business Council (CBBC), and speaking to UK MPs in an attempt to resolve the problems with squatters.
As the fashion world becomes more international, the realities of operating a business can be difficult. Make sure you protect your brand at the earliest possible stage by registering trademarks across all the jurisdictions. The Madrid Protocol which allows your UK registered trademark to be registered in any of the countries that have joined the Madrid Protocol (91 countries, including China) by filing just one single application. Look out for our upcoming guidance on filing your fashion trademark across multiple jurisdictions!