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Is an unauthorized trademark product processor a trademark infringement?
Lingzhi Company sued Yilong Garment Factory to the court because it believed that processing and producing products with only trademarks were suspected of infringing its legally held exclusive right to use registered trademarks. So how will the court finally decide? Let's take a look with Bajie Intellectual Property Trademark Transfer Network:

It is understood that Lexus is authorized to use the unique trademark No. 1447254, and has the right to defend rights through legal means in its own name. After years of market operation, ONLY has become a well-known women's clothing brand.

20 14 12 1, the law enforcement officers of Haizhu Branch of Guangzhou Administration for Industry and Commerce (hereinafter referred to as Haizhu Branch) inspected the business premises of Yilong Garment Factory and found that the factory processed 980 garments with only logos. After verification, Yilong Garment Factory has not been authorized or licensed by the trademark owner, nor can it produce other supporting documents. Products identified by the sole trademark owner as infringing the exclusive right to use a registered trademark. Subsequently, Haizhu Industrial and Commercial Branch confiscated 980 pieces of clothes involved and fined Yilong Garment Factory 20,000 yuan.

However, it didn't take long for Ganoderma lucidum to file a lawsuit in Haizhu court, requesting the court to order Yilong Garment Factory to immediately stop producing and selling clothing products that infringed on the exclusive right to use registered trademarks, and Yilong Garment Factory compensated Ganoderma lucidum for economic losses of 6,543,800 yuan.

After hearing the case, Haizhu Court held that the existing evidence confirmed that Yilong Garment Factory processed and produced short-sleeved T-shirts with trademarks only without the permission or authorization of Ganoderma lucidum or the trademark owner involved, and it was investigated and dealt with by Haizhu Industrial and Commercial Branch. In view of this, the above-mentioned behavior of Yilong Garment Factory has constituted an infringement of the exclusive right to use a registered trademark held by Lexus, and it should bear civil liabilities such as stopping the infringement and compensating for losses.

In the judgment of the first instance, the court found that the behavior of Yilong Garment Factory constituted an act of use in the sense of trademark law, which constituted an infringement of the exclusive right to use a registered trademark, and rejected the appeal request of Yilong Garment Factory. In this case, according to the nature, duration, scope of use, scale of operation, well-known degree of the trademark, and the reasonable expenses paid by Ganoderma lucidum Company to stop the above-mentioned infringement, it is determined that Yilong Garment Factory should compensate economic losses and reasonable expenses of 55,000 yuan as appropriate.

Yilong Clothing refused to accept the suit and later appealed to Guangzhou Intellectual Property Court. Yilong Garment Factory only earned processing fees and did not enjoy the intangible value of the trademark, which should not be regarded as the use behavior in the sense of trademark law.

Guangzhou Intellectual Property Court held that the focus of the dispute in this case was whether Yilong Garment Factory infringed the exclusive right to use the trademark involved; Whether the amount of compensation awarded by the court of first instance within the statutory scope is reasonable.

After trial, the court held that, according to the first paragraph of Article 57 of the Trademark Law, using the same trademark as its registered trademark on the same commodity without the permission of the trademark registrant is an infringement of the exclusive right to use a registered trademark, and the goods used by both are clothes and belong to the same commodity, and the behavior of Yilong Garment Factory is an infringement.

In terms of the amount of compensation, the court held that Yilong Garment Factory claimed that all the clothing raw materials and infringement marks were provided by customers, and all of them were confiscated afterwards, but it did not provide any evidence related to the entrusted processing, so it was impossible to determine whether the claimed processing source was true or not, and whether the actual processing quantity was the amount confiscated by the industrial and commercial administrative department. Yilong garment factory claims that it has no profit and lacks basis. In addition, the court of first instance applied the statutory compensation method and found that Yilong Garment Factory compensated Lexus for 55,000 yuan, which was not abnormally high.