Basic information:

Case No.: (2016) Jing 73 Min Chu No. 93, (2017) Jing Min Zhong No. 413

Plaintiffs: Deere Company, John Deere (China) Investment Co., Ltd

Defendants: John Deere (Beijing) Agricultural Machinery Co., Ltd., John Deere (Dandong) Petrochemical Co., Ltd., Lanxi Jialian Deere Oil Chemical Co., Ltd

Case brief:

Founded in 1837, Deere Company is a world-famous agricultural machinery manufacturer and engineering and forestry equipment manufacturer. It entered China in 1976 and established John Deere (China) Investment Co., Ltd. (hereinafter referred to as John Deere China Company) in 2000. Deere Company holds series of trademarks such as "JOHN DEERE" and "約翰.迪爾". Deere Company grants its non-exclusive license to exploit the trademark to John Deere China Company. The two plaintiffs found that the three defendants produced and sold industrial oil and other products with the same or similar logo as the registered trademark of Deere Company in China, and registered the trademark "佳聯(lián)迪爾" on industrial oil and other products, and registered the business names as "佳聯(lián)迪爾" and "約翰迪爾". The two plaintiffs claimed to calculate the amount of punitive damages based on 3 times of the profits from infringement, and requested to order the three defendants to jointly compensate the economic losses of 5 million yuan.

The court of first instance held that the three defendants jointly infringed the trademark rights of the two plaintiffs. As for the calculation of the amount of compensation, considering that the three defendants committed various forms of infringement, not only using the trademarks involved on the same or similar products, but also using the trademarks involved through registering domain names, business names, etc., and copying, imitating, and translating the trademarks involved in the way of registered trademarks. The three defendants have a great number of franchisees, and they have sales networks in Liaoning, Heilongjiang, Xinjiang, and Beijing, and the profits from infringement are considerable. Based on the calculation from the evidence on record, the three defendants' sales volume from infringement in two years exceeded 16 million yuan. After the administrative penalty, the defendants still continued to commit infringement, with obvious subjective malice and serious infringement. For the profit from infringement, it is calculated by reference to the number of infringing products seized and detained, the monthly sales volume of infringing products involved in relevant administrative penalties, the monthly sales volume of infringing products reflected in the case of invalidation of trademark rights, the average unit sales price of the two defendants, the average profit rate of the industry in which the products involved are, and other indicators. 3 times of the amount determined by the above method is far more than the compensation amount of 5 million claimed by the two plaintiffs. The first instance fully supported the two plaintiffs' claim for compensation. The appeal was rejected in the second instance and the original judgment was upheld.

Typical significance:

This case is a typical case where there is willful infringement and serious circumstances in the application of punitive damages. The continuous infringement of the defendants shows being aware of the nature of the infringement of the acts committed, and the defendants continue to commit infringement in disregard of the administrative penalty decision. The infringement of the defendants has two elements at the same time: willful infringement and serious circumstances, which meet the applicable requirements of punitive damages.

(Source of case: Beijing Higher People's Court)