LEVI STRAUSS & Co. vs. Guangzhou City Yixuan Apparel Co., Ltd. and Liu Zuofu

CHANG TSI
Insights

July06
2017

Background

Our client LS&Co. is the owner of “LEVI’S” in China. Its brand “LEVI’S” is known as “Li-Wei-Si” (In Chinese: 李维斯) by Chinese consumers. A trademark squatter, an individual named Liu Zuofu, registered a trademark fully incorporating “Li-Wei-Si” as early as 2010: “Ku-Ai-Li-Wei-Si.” At this time the client owned no prior registration of the Chinese mark “Li-Wei-Si.” Liu Zuofu also owns a company named Guangzhou City Yixuan Apparel Co., Ltd. to manufacture and distribute “Ku-Ai-Li-Wei-Si” branded infringing jeans.

Difficulties

1. The Defendant has had registration of the infringing mark “Ku-Ai-Li-Wei-Si” in connection to apparel since 2010. Their trademark right is solid and hard to cancel.

2. The client’s application of “Li-Wei-Si” came is later than the Defendant’s registration and is still pending. Technically, the client does not own the trademark right to the Chinese mark.

3. The Defendants filed a counter action against the client in the trademark infringement action we filed against them, accusing the client of conducting trademark infringement by using the Chinese mark “Li-Wei-Si”.

4. The Defendants filed an independent suit against the client’s local company and alleged their use of the Chinese mark “Li-Wei-Si” as constituting trademark infringement.

Strategies

1. Filing trademark infringement action against the Defendants for their use of other marks, which are similar to the client’s registered trademark. In this way, we put pressure on the Defendant and take initiative;
2. Arguing that the parties in the counter action are different from the original action and that the Defendants’ counter action should be overruled. 
3. Expediting the decision made on the opposition against the client’s application of “Li-Wei-Si”. If the client obtains the ownership of the Chinese mark, this could be the strongest defense against the Defendants’ accusation. 
4. Filing declaration invalidity action against the Defendant’s registration to invalidate the grounds of their counter action.

Outcome/Result

1. The 1st Defendant Guangzhou City Yixuan Apparel Co., Ltd. shall immediately stop selling jeans that infringe upon the Plaintiff’s registered trademarks;

2. The 1st Defendant shall compensate the Plaintiff for losses amounting to CNY 180,000 (approx. USD 26,470);

3. The 2nd Defendant Liu Zuofu is jointly and severally liable for the 1st Defendant’s compensation paid to the Plaintiff.

 

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