Chinese online store Shangpai ordered to pay punitive compensation over 700,000 USD for Huawei trademark violation


7e In July, the Hangzhou Intermediate People’s Court reported on the case it handled between online store Shangpai and Huawei Technologies. The first was founded in 2009 and its main activity is the sale of digital products online. The latter has considerable influence in China and even around the world as a leading global provider of information and communications technology infrastructure and smart devices. Its trademarks “Huawei” and the corresponding visual logo are also well known. Shangpai had been actively seeking relationships with Huawei to improve the store’s sales volume. In practice, this meant that Shangpai added the word “Huawei” to the name of the mobile PTZ which was sold by its online store, and used the “Huawei” symbols and logo in the product display diagram. At the same time, Shangpai’s online store displayed another exclusive Huawei symbol, albeit with some changes in the number of petals and English characters of the Huawei mark. In addition, the store also showed consumers false network channel sales authorization from Huawei to create the illusion that the products were related to Huawei, causing misunderstandings among customers. Since Huawei believed that Shangpai’s aforementioned actions constituted trademark infringement, they applied for an order to stop the infringement and demanded punitive compensation of 5 million yuan (about 740,000 USD) for economic losses.

In court, the first instance ruled that the use of “Huawei” (and logo) by Shangpai, in the process of selling PTZ mobile in its online store, constitutes an infringement of the exclusive right to use the registered trademarks owned by Huawei. Therefore, Shangpai should bear the civil liability to stop the infringement and compensate for the losses. In addition, the first instance also ruled that Shangpai intentionally violated trademark law and the circumstances were serious, so they should be liable for punitive damages. Therefore, the court fully supported Huawei’s 5 million yuan compensation claim from Shangpai.

After the trial judgment, neither party appealed and the judgment took effect.

Further information can be found here (in Chinese)


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