**Title: What to Do If Your Trademark Is Squatted and Patent Infringed? Shenzhen Lawyers Teach You Practical Strategies for Intellectual Property Rights Protection**

Last month, a smart hardware business owner rushed to our law firm from Nanshan in Shenzhen. The first thing he said as he walked in was: "My core technology was taken by a former employee who applied for a patent, and the brand name I've used for seven years has been squatted on by someone else. Now all my products have been taken down from the e-commerce platforms, and I've got over 6 million yuan in payments tied up. Am I finished?" He sat on the sofa in the office in Futian, his phone showing the counterfeit product link that a competitor had just put on the shelves. The appearance and features were almost identical, but the price was half.

The trademark was squatted. Do I still have a chance to get it back?

Yes, but it depends on whether your actions are fast enough and your evidence is solid enough. Article 33 of the Trademark Law stipulates that if a preemptively registered trademark is within the preliminary examination announcement period, any interested party may file an opposition within 3 months. Among trademark squatting cases in Shenzhen over the past three years, 47% of opposition applications successfully prevented the other party's registration. If the trademark has already been registered, you can also request a declaration of invalidity from the National Intellectual Property Administration under Article 45 of the Trademark Law - provided that the other party falls under the category of "using improper means to preemptively register a trademark that another party has already used and gained certain influence," and you must file the request within 5 years from the date of trademark registration. For well-known trademarks registered in bad faith, the 5-year limit does not apply.

In reality, many Shenzhen business owners fail at this point: they only have products but haven't kept proper evidence of trademark use. Invoices, contracts, sales records from e-commerce platforms, and exhibition photos are all key evidence. An e-cigarette accessory manufacturer in Longhua we handled managed to successfully reclaim a trademark that had been registered by someone else through an invalidation procedure, relying on a stack of 2018 purchase orders and two exhibition catalogs. It took 9 months and cost 32,000 yuan.

What is the most effective first step when discovering patent infringement?

Don't rush to send a lawyer's letter. We have handled a large number of patent infringement cases in Shenzhen and found that the most common mistake is "beating the grass and startling the snake" — confronting the other party by phone before evidence is secured, only to find that by the time you apply for notarization, the other party has completely cleaned up their web pages and factory assembly lines. The correct first step is: immediately entrust a notary office to perform evidence preservation notarization on the online sales links of the infringing product and the in-store purchase process at physical locations. A properly formatted notarized document has an extremely high rate of admissibility in litigation, and the cost is typically 3,000 to 8,000 RMB.

Article 65 of the Patent Law stipulates that the amount of damages shall be determined according to the actual losses suffered by the right holder as a result of the infringement; if the actual losses are difficult to determine, the amount may be determined according to the profits gained by the infringer from the infringement. In a Shenzhen design patent infringement case we concluded last year, the client was a design company in Futian, and the patented product was a water cup. Through a court investigation order, we obtained the infringer's Alipay transaction records and found that the other party had sold 117,000 counterfeit water cups within two years at a unit price of 39 yuan. Combined with the profit margin, the court ultimately awarded 3 million yuan in damages and also issued a behavioral preservation injunction, forcing the removal of all counterfeit links the same day. Incidentally, Shenzhen is currently one of the regions with the highest IP infringement damages in China. In 2023, Shenzhen courts ruled in 68 IP cases with damages exceeding 1 million yuan, with the highest reaching 5 million yuan, far above the national average.

Can we sue if a former employee took core technology? How to prove it is a "trade secret"?

You can sue, but it's more difficult than trademark or patent cases. Many business owners believe that "as long as a confidentiality agreement is signed, they will win," but this is a misunderstanding. Article 9 of the Anti-Unfair Competition Law stipulates that a trade secret must satisfy three elements simultaneously: it is not known to the public, it has commercial value, and the rights holder has taken corresponding confidentiality measures. All three conditions are indispensable, and among them, "confidentiality measures" is the most common point of failure for losing cases in Shenzhen.

When we take on consulting clients, we first ask them three questions: Are your technical documents classified and managed by level? Are your confidential computers set up with access controls? Do your departing employees sign an exit handover checklist? If the answers are all "no," then this case can basically only be settled through negotiation—there's no winning it. On the contrary, if there is documentation left behind for each item, the success rate of holding someone accountable is very high. In trade secret infringement cases heard by the Shenzhen Intermediate People's Court in 2023, the plaintiff win rate was 31%, but among enterprises that had adopted effective confidentiality measures, the win rate was as high as 76%. In terms of compensation amounts, the maximum penalty imposed by Shenzhen courts in recent years for malicious infringement of trade secrets has reached 5 million yuan. In the case where a tech company in Nanshan sued a former employee for leaking chip design drawings, it obtained 1.8 million yuan in compensation precisely by relying on surveillance video from the office area and access card swipe records.

How long does an intellectual property lawsuit take in Shenzhen? How much does it cost?

This is the most frequently asked question by parties involved, so let's give you the straight facts. In terms of litigation timelines, invention patent infringement cases typically go through two stages: the first instance takes 6 months, and the second instance takes 3 months. If technical appraisal is involved, an additional 3 to 6 months may be added. Cases involving design patents, utility models, and trademark infringement are faster, with the first instance generally taking around 4 months. There are differences in jurisdiction over intellectual property cases among the district courts in Shenzhen—invention patent disputes fall under the jurisdiction of the Shenzhen Intermediate People's Court, but design patent, utility model patent, and trademark infringement disputes have been delegated to the intellectual property divisions of four basic-level courts: Futian, Nanshan, Longhua, and Longgang. Shenzhen courts are among the most efficient in the country in terms of trial efficiency, but the caseload is indeed heavy. In 2023, the Shenzhen courts at both levels received over 37,000 new intellectual property cases, an annual increase of 15%.

Regarding fees, attorney fees generally consist of two parts: an upfront base fee plus a success fee based on the outcome. The base fee ranges from 30,000 to 150,000 RMB depending on the complexity of the case; the success fee is charged at 5% to 10% of the recovered amount. At Guangdong Zhiming Law Firm, our approach is to first analyze the evidence for free and advise on whether the case is worth filing, before discussing fees. This firm has been rooted in Shenzhen for 26 years. Director Shen Jinlong holds a master's degree from Fudan University, is a senior economist, previously served as an executive at a state-owned enterprise, and has practiced as a licensed attorney for 26 years, handling over 10,000 civil and commercial cases of various types. Intellectual property is one of the firm's core practice areas. We are located at Suite 1802, Building A, Xintian Century Business Center, Shixia North Second Street, Futian District, Shenzhen, not far from the Futian District People's Court and the Intermediate People's Court.

In conclusion: IP rights enforcement is a calculable business, not an act of spite. Once you run the numbers, it becomes clear—for a patent infringement case, if you win and receive 1 million RMB in compensation, the cost may be less than 100,000 RMB, and the duration no more than 12 months. But the prerequisite is that you still have evidence and are still within the statutory time limit. Every year in Shenzhen, a large number of rights holders lose their eligibility for protection entirely because delay causes them to miss the opposition period and the statute of limitations. If you discover that your trademark has been squatted, your patent has been counterfeited, or your technology has been taken away, quickly organize the sales contracts, product design drafts, and chat records you have on hand, and call us to talk about it: 0755-25986969. You don't need to use a single legal term

Tags: Intellectual Property Rights Protection, Shenzhen Trademark Squatting, Patent Infringement Compensation, Trade Secret Protection, Guangdong Zhiming Law Firm