Inside Manolo Blahnik’s 22-year trademark battle
In this in-depth case study, Edward Chatterton, Partner, Hong Kong, and Crystal Cai, Senior Consultant, Shanghai, recount a trademark battle that spanned 22 years but ended with Manolo Blahnik winning the fight to register his brand in China.
- Footwear and luxury brand Manolo Blahnik achieves registered mark in China
- Trademark pirate had previously registered MANOLO&BLAHNIK and established use
- Retrial in the Supreme People’s Court results in victory for Spanish designer
A crucial driver of global sales for luxury brands, the China market accounts for around a third of the global luxury goods market. Its sales are also a bellwether of success for most of the world’s luxury brands. Yet, until recently, a renowned shoe designer and founder of an eponymous luxury footwear brand could not even enter the market due to a long-running trademark dispute – a trademark pirate had registered MANOLO&BLAHNIK, a mark incorporating Manolo Blahnik’s name. After a battle lasting more than 20 years, a recent judgment by China’s Supreme People’s Court has finally enabled the luxury footwear company to enter the country. In this piece, we dive deeper into the case and reveal the strategy that led to success.
Background
The battle began in 1999 when a Chinese businessman and established manufacturer in the footwear industry Fang Yuzhou (‘Fang’) pre-emptively applied to register a mark MANOLO&BLAHNIK for footwear. At that time, Manolo Blahnik was already a world-famous designer and active in the industry since the early 1970s, but he had not applied for a trademark nor commenced business in Mainland China. Blahnik opposed the pirate mark in early 2000 primarily based on his unregistered well-known mark MANOLO BLAHNIK and his prior name rights. However, the opposition was dismissed on the basis that the evidence submitted was insufficient to prove his reputation in China prior to the filing date of the pirate mark. Manolo Blahnik appealed the decision all the way to the Beijing High People’s Court but the appeals at every level were dismissed.
In 2013 and 2014, Manolo Blahnik filed a non-use cancellation and an invalidation action respectively against Fang’s pirate mark. The non-use cancellation was unsuccessful as Fang produced sufficient evidence to establish use of the pirate mark. The invalidation action was primarily based on MANOLO BLAHNIK being an unregistered well-known mark and on Manolo Blahnik’s personal name rights. It also accused Fang of bad faith, an additional ground under the new Trademark Law in effect at that time.
The invalidation action was dismissed because of insufficient supporting evidence. Manolo Blahnik then filed an appeal before the Beijing Intellectual Property Court, supplementing with additional prior use evidence and Chinese translations of evidence previously submitted in English. However, the claim regarding Fang’s bad faith was dismissed by the IP Court due to lack of sufficient evidence, and the claims in relation to unregistered well-known mark and prior name rights were dismissed due to res judicata.
This meant that these claims and the facts on which the claims are based had already been tried and concluded in the earlier opposition proceedings and therefore could not be re-litigated. The additional prior use evidence submitted in the invalidation proceeding was considered insufficient to form new facts to overcome res judicata. The High Court later affirmed the IP Court’s decision to dismiss the invalidation.
Supreme Court re-trial
In April 2021, Manolo Blahnik filed an application for a re-trial of the invalidation action before the Supreme Court. It was the designer’s final opportunity to defeat the pirate mark and reclaim the right to use the MANOLO BLAHNIK name in China.
Given the lack of prior use as a trademark in China, Manolo Blahnik abandoned the claim based on unregistered well-known trademark status. Instead, the re-trial focused on Manolo Blahnik’s personal name rights and Fang’s bad faith, both challenging claims to make because of two reasons.
First, the name rights claim relied heavily on use evidence. However, the majority of the use evidence submitted in support of the invalidation action had already been used in the opposition proceedings, and therefore res judicata was likely to be applied to that use evidence again. Manolo Blahnik had also exhausted almost all the evidence that he could produce.
Second, the Chinese courts adopt a high threshold in recognising bad faith. Theoretically, Manolo Blahnik had to prove that Fang was in bad faith when he applied to register the pirate mark back in 1999, which was effectively impossible.
With respect to the name rights claim, Manolo Blahnik argued that the 500 pages of untranslated evidence submitted in the opposition proceedings, which had previously been excluded, should be regarded as never submitted and the freshly-translated evidence was sufficient to form new facts that were substantively different from the facts of the oppositions.
Additionally, Manolo Blahnik collected and submitted additional use evidence. This included national library search reports, media reports and books that show he had been involved in the footwear industry since the 1970s, had used and promoted his name as his brand for footwear products, and received numerous awards for his footwear designs. He also submitted photos of Manolo Blahnik stores in Hong Kong and elsewhere that had opened before 1999, as well as witness statements issued by well-known fashion journalists and important figures in the fashion industry around the world regarding his high reputation as a footwear designer for many decades.
In relation to the bad faith claim, Manolo Blahnik referenced a Supreme Court precedent that recognised a trademark pirate’s bad faith behavior after filing the pirate mark. He arranged a notarised trap purchase of counterfeit Lacoste and Gucci products from the shoe store operated by Fang and his wife in 2020 and brought the evidence to the Supreme Court right before the preliminary hearing to show that Fang had a track record of copying third party brands.
Manolo Blahnik further emphasised that Fang was using the pirate mark in the same stylisation as Manolo Blahnik’s mark from the 1970s, and he had demanded an extremely high price to sell the pirate mark to Manolo Blahnik.
The Supreme Court’s decision
The argument with respect to the 500 pages of untranslated evidence was ultimately not accepted by the Supreme Court. It considered that it would not have been difficult to obtain Chinese translations of the evidence in the opposition proceedings. However, the Supreme Court found res judicata was not applicable to the name rights claim because Manolo Blahnik had collected and filed a considerable amount of new evidence in the invalidation proceedings, and the new evidence was sufficient to form new facts which were substantively different from those of previous opposition proceedings.
On that basis, the Supreme Court further found that the new evidence was sufficient to prove that Manolo Blahnik had obtained a certain degree of reputation prior to the filing date of the pirate mark among the fashion industry in mainland China, and that reputation in Hong Kong and foreign countries could somewhat extend to Mainland China.
In relation to name rights issues generally, the Supreme Court reasoned that a mark should be considered as infringing upon a person’s prior name rights if the relevant public would consider the mark as referring to that person, or would easily believe that the products bearing the mark are licensed by or have a certain connection with that person. The Supreme Court recognised that MANOLO BLAHNIK, being a Spanish name rather than an existing term, refers to the world-renowned footwear designer. Considering this and the reputation of Manolo Blahnik proven by the new evidence, it concluded that the public would associate the mark in dispute with Manolo Blahnik and therefore it had infringed upon Blahnik’s prior name rights.
Whilst the Supreme Court did not directly comment on the bad faith claim in its final judgment as Manolo Blahnik had been successful in the name rights claim, the Supreme Court nevertheless appears to have taken the bad faith evidence into consideration. Specifically, in its reasoning in relation to the name rights claim, the Supreme Court commented that Fang had failed to provide a reasonable explanation as to how the mark in dispute was created, and Fang and his company had been in the footwear industry for a long time and should have known of Manolo Blahnik. The Supreme Court observed that there was no other explanation as to why the mark in dispute wholly contained Manolo Blahnik’s name.
The takeaways for brand owners
For brand owners there are some clear takeaways from this case. First, protect all key brands by filing trademark applications as early as possible. Where budget permits, these applications should cover both core and ancillary goods and services. Brands should also proactively monitor trademark applications to pick up pirate marks and bad faith filings as early as possible.
Second, in such bad-faith cases, putting forward the best possible evidence of reputation, both from China and globally, is of paramount importance. This evidence must be presented in a way that enables the Chinese courts to understand the extent of the brand owner’s reputation and show why the pirate’s actions are not merely coincidental. Collating, cataloguing and maintaining this evidence internally is vital. It should be part of a global brand protection strategy and applied across departments to obtain the best evidence available. The Manolo Blahnik team had developed and maintained an extensive evidence repository, which was supplemented by further online and offline searches. Internal legal departments working cross-departmentally in this way can be invaluable.
Third, the introduction of evidence of bad faith can be an important factor in determining the ultimate outcome, even when not explicitly referenced in the judgment.
Conclusion
The Supreme Court’s judgment is a clear victory for Manolo Blahnik. It is also encouraging to other IP rights holders previously frustrated by the Chinese judicial system. In recent years, the Chinese IP authorities and Chinese courts have shown a strong determination to fight brand piracy and counterfeiting, developing an overall judicial environment that is more favorable to IP rights holders. This was an important factor Manolo Blahnik considered when deciding whether to proceed with the re-trial.
DLA Piper and Beijing Wanhuida Law Firm worked on this re-trial. The DLA Piper team was led by Edward Chatterton, based in Hong Kong. Edward was supported by Crystal Cai, Senior Consultant, Shanghai, IPT. The DLA Piper and Wanhuida teams worked together to devise the overall strategy for the re-trial. Wanhuida provided legal opinions for the re-trial and represented Manolo Blahnik in the re-trial court hearing.
