Qvod to make a comeback? Trademark sold for 9.5 million! Can the original holder continue using it after the auction?
Compiled from: 21st Century Business Herald, China Trademark Registration Network, Meixian Property Rights Media Person, Baidu Baike
On the afternoon of April 14, a reporter learned from the Alibaba auction platform that a batch of trademarks and some patents owned by Shenzhen QVOD Technology Co., Ltd. had completed bankruptcy auction. Among them, QVOD's trademarks were sold at a price of 9.5 million yuan, while some of QVOD's patents were sold at a price of 134,900 yuan.
It is reported that the auction included a total of 234 trademarks of QVOD, of which 17 were in a "invalid" status, 24 were in a "pending substantive examination" status, 5 were duplicate trademarks, and 188 were within the exclusive rights period.
Among the still valid trademarks, the main ones include "QVOD", "KUAIBO", "QVOD", "QMV", "QVOD Cloud", etc. QVOD was established on December 26, 2007, and its "QVOD" video player was once the product with the highest market share, accumulating a large number of users. Therefore, the "QVOD" brand is widely known.
18 bidders competed with 292 extensions, and the "QVOD" trademark was auctioned from 40,000 yuan to 9.5 million yuan.
During the one-day auction, the starting price of the QVOD trademark was 45,110 yuan. According to information from the Alibaba auction platform, 10,973 people watched the auction.
The reporter noted that the bidding process for this item was very intense, with 18 people registering to participate. The auction started at 10:00 a.m. on April 13, and within 7 seconds, someone bid 45,110 yuan. The competition was fierce, and by the normal end time of 10:00 a.m. on April 14, it had not yet concluded, continuing with extensions.
The final showdown was between bidders "X2977" and "C7449". After the bid reached 7 million yuan, only these two bidders remained competing. Ultimately, at 13:53:58 on April 14, bidder X2977 won with 9,500,610 yuan.
The entire auction involved 402 bids and 292 extensions. The final transaction price for the Qvod item was 9,500,610 yuan, 210 times the starting price.
Industry insiders pointed out that the high transaction price was mainly because the client did not provide cost composition data for the trademark. The evaluation was based on the cost method, considering only trademark agency registration fees as the replacement value, excluding design fees. The trademark's replacement cost was set at 1,000 yuan, and the remaining validity period was determined. Based on the asset situation, a quick liquidation discount rate of 30% was applied. The final market value = trademark replacement full price × proportion of remaining valid years, while the liquidation value = market value × (1 - quick liquidation discount rate), thus determining the assessed value.
As a former home entertainment staple, the Qvod trademark still held appeal. The long extension time was partly due to the low starting price and low increment, with a minimum increment of 500 yuan. In the final stage, bidders increased by 200,000 or 500,000 yuan to avoid a prolonged battle.
In stark contrast to the fierce trademark bidding, some of Qvod's patents seemed to attract little interest. Among the 54 patents auctioned, some had remaining valid years but unpaid annual fees. The starting price was 133,490 yuan, with only two registrants, and it sold for 134,990 yuan after just one bid increase.
The "King of Video Players" went into bankruptcy liquidation.
According to information from Alibaba Auction, the auction of QVOD's assets was due to the administrator executing the company's bankruptcy liquidation case.
In July 2014, the Nanshan District People's Court of Shenzhen (hereinafter referred to as Nanshan Court) issued a civil mediation document, which confirmed that QVOD owed Shenzhen Jin Yatai Technology Co., Ltd. (hereinafter referred to as Jin Yatai) 9.7377 million yuan in货款 and 300,000 yuan in overdue payment interest. Subsequently, Jin Yatai applied to Nanshan Court for compulsory enforcement.
In October of that year, Nanshan Court issued an enforcement ruling, stating that all bank accounts under QVOD's name had been legally frozen by other authorities and there was currently no property available for enforcement, thus ruling to suspend the case. The creditor's rights claimed by Jin Yatai remained unsettled.
In August 2018, Jin Yatai filed a bankruptcy liquidation application against QVOD. In response, the Shenzhen Intermediate People's Court held that QVOD was unable to repay its due debts and clearly lacked the ability to repay, ruling to accept Jin Yatai's bankruptcy liquidation application against QVOD.
On December 29, 2019, the People's Court Announcement Network disclosed that QVOD's creditors' meeting had voted in writing to approve the "First Bankruptcy Property Distribution Plan." The total distributable bankruptcy property of QVOD was approximately 123 million yuan, with priority payment and reservation of bankruptcy expenses and common benefit debts amounting to 7.9837 million yuan. The total bankruptcy creditor's rights participating in distribution and deposit were 148 million yuan. The repayment ratio for employee claims and tax claims was 100%, and the repayment ratio for ordinary claims was 76.4772%. For estimated claims, the administrator deposited the corresponding repayment shares in accordance with the law.
What is a trademark? What is the difference between a trademark and the commonly referred to logo?
A trademark is a mark used to distinguish the brand or service of one operator from the goods or services of another operator.
According to Article 8 of the Trademark Law of the People's Republic of China, any sign that can distinguish the goods of a natural person, legal person, or other organization from those of others, including words, graphics, letters, numbers, three-dimensional marks, color combinations, sounds, and combinations of the above elements, may be applied for registration as a trademark.
Legal differences between a logo and a trademark:
A logo can be a trademark, and likewise, a trademark can serve as a logo, but a logo is not necessarily a trademark, nor is a trademark necessarily a logo.
(1) Different acquisition of rights. A logo, as a work of art, does not require registration; copyright is automatically obtained upon its creation, whereas a trademark must be registered with the relevant national authority to acquire trademark rights.
(2) Different ownership of rights. The designer and the owner of a logo may not be the same person. Ordinary companies often commission designers to create logos. In such cases, as commissioned works, the ownership of the logo's copyright falls into two scenarios: either it is agreed to belong to the client, or, if no agreement is made, it belongs to the designer. In contrast, a trademark belongs exclusively to the trademark holder, which falls under the scope of intellectual property.
(3) The legal protections differ. A logo is protected by the Copyright Law, while a trademark is protected by the Trademark Law. If a logo is registered as a trademark, then this trademark logo is protected by both the Copyright Law and the Trademark Law.
What is a trademark auction? Why can trademarks be auctioned?
A trademark auction is one of the ways to transfer trademarks. In essence, a trademark auction involves auctioning trademark rights. Since trademark rights are a type of property right, they can be separated from the rights holder and transferred for value, becoming the subject of a transaction.
According to Article 6 of the Auction Law of the People's Republic of China: "The auction subject shall be items or property rights owned by the client or that can be disposed of according to law."
The Trademark Law of China stipulates: A trademark approved and registered by the Trademark Office is a registered trademark, and the trademark registrant enjoys the exclusive right to use the registered trademark. Exclusive rights include: the right to use, the right to license, the right to exclusivity, the right to prohibit, the right to invest, the right to transfer, and the right to inherit.
As an intangible asset, a trademark can be disposed of by the trademark owner according to law, and thus it can be auctioned as a subject matter.
After a trademark auction, the entity that acquires the auctioned trademark rights must assume the obligation to ensure the quality of the goods or services using the registered trademark, in order to maintain the trademark's reputation and protect consumer interests. Once a trademark is approved, it has legal effect, and its scope of protection is determined accordingly. The entity that obtains the trademark rights through auction may not arbitrarily change the design of the trademark or its scope of use. If changes to registered trademark matters are necessary, the modification procedures must be carried out in accordance with the provisions of the Trademark Law.
Can the original holder continue to use the trademark after a successful auction?
After a successful trademark auction, the buyer generally needs to hold the court's enforcement assistance notice to go through the transfer procedures at the Trademark Office. Once the transfer of the registered trademark is completed, it means that the original trademark holder has transferred the exclusive right to use the trademark to the transferee, and the original trademark holder no longer has the exclusive right to use the trademark.
After the trademark transfer is completed, the transferee becomes the new owner of the trademark. If the original trademark registrant still needs to use the original trademark for goods or services, they can negotiate and sign a licensing agreement with the transferee, thereby achieving continued use through licensing.
If the original trademark registrant continues to use the trademark on goods, packaging, containers, or transaction documents without authorization, or uses the trademark in advertising, exhibitions, or other commercial activities, this will constitute trademark infringement.
The transfer of a registered trademark not only results in the transfer of trademark rights between the transferor and the transferee but also directly affects the consumer base of the original trademark holder and the interests of trademark licensees. This highlights the role of the transfer agreement signed during the trademark transfer, which ensures the legality of the transfer and protects the interests of trademark stakeholders and consumers. Additionally, from a market perspective, a trademark can be traded as a special commodity. As long as it can be traded, it generates value, which is similar to other goods for sale. The trademark holder can freely transfer the trademark within the scope permitted by law, based on their own needs and intentions.
[1] Transferring a trademark means that the subject of the registered trademark changes, and after the transfer is completed, the original holder no longer enjoys exclusive rights, usage rights, licensing rights, etc., and these trademark rights are exclusively held by the assignee.
[2] In summary, the final conclusion is that after a trademark is transferred, the original trademark holder cannot use it again without the permission of the new trademark owner.
Note: Image source from the internet
