L'Oreal's 10-year Trademark Battle

In the 13 years French cosmetics giant L'Oreal Group has been in China, 10 years have been spent fighting and losing its battle against trademark infringement.

In 1999, three years after L'Oreal introduced its Vichy brand to China's cosmetics market, the company applied with Chinese agencies for two trademarks.

The trademarks were for Vichy and also Weizi, its translation of two Chinese characters.

On Oct 14, 1999, the French cosmetic giant had its Vichy and Weizi trademarks approved for registration by the Trademark Office under the State Administration for Industry and Commerce (SAIC).

However, before the French cosmetics group obtained official approval for its Vichy-related trademarks, in March 1999 a person known only as Liao applied for a trademark for his cleaning products, combining two Chinese characters reading Weizi and five English letters reading WEIZI.

In April 2000, Liao, who lives in southeastern China's Guangdong province, was approved by SAIC for registration of his trademark.

Three months later, in July 2000, L'Oreal objected to SAIC, arguing that the Weizi name used by Liao amounted to a violation of L'Oreal's intellectual property rights.

First round

After two years of investigation, SAIC upheld Liao's trademark. L'Oreal had lost the first round.

According to the announcement from the SAIC Trademark Office, the two sides manufactured different kinds of products and the two trademarks were different in appearance.

"Liao's registered trademark does not cause confusion with L'Oreal's two trademarks," according to SAIC's judgment released in 2002.

The cosmetics firm appealed, and a six-year investigation followed.

In June 2008, the Trademark Office ruled that Liao's trademark was not similar to L'Oreal's Vichy and Weizi trademark. Liao's trademark use rights were upheld.

Round two

After two losing rounds, the French cosmetics maker filed a lawsuit against Liao's company in Beijing No 1 Intermediate Court.

"Since L'Oreal entered the Chinese market 13 ago, we are engaged in combining our brand culture with Chinese culture in a bid to better adapt to local consumers' customs," a senior employee from L'Oreal China, surnamed Liu, told China Business Weekly.

The court recently ruled for Liao, and L'Oreal had not yet responded to its latest loss.

Yan Ming, an expert on China's cosmetics industry, said that international cosmetics giants for years have engaged in competition with domestic cosmetics makers, often specializing in combining Chinese traditional medicine with their products.

But the decade-long trademark infringement dispute between L'Oreal and Liao's company highlights a new kind of competition in the cosmetics market, in which cosmetics makers must pay greater attention to protecting their intellectual property rights, Yan told China Business Weekly.

Lost in translation

For foreign companies, it is necessary to pay close attention when translating a foreign language trademark into a Chinese mark.

It should keep the essence of the mark in its original language while also ensuring the Chinese version appeals to the psychological nuances of Chinese consumers, said Liu Guizeng, a senior Chinese trademark specialist who works in the Beijing-based Patent and Trademark Law Office under the China Council for the Promotion of International Trade.

"But in recent years, an increasing number of foreign traders got involved in patent and trademark lawsuits, many of whom lost in translation," Liu Guizeng said.

The main reason for their losses was the large number of Chinese traders who choose trademarks associated with goods from foreign countries to help attract Chinese consumers' attention.

Besides choosing a suitable translation for a foreign language-based trademark, it is also important to know trademark infringement regulations in the Chinese market, said Dong Ling, an instructor at the School of Law at the University of International Business and Economy.

"We should see fighting piracy as part of China's process for economic development and social reform," Dong said.