Compiled from: China Economic Weekly, Tuotian Intellectual Property
 
Recently, a trending topic about "Muji" suing "Muji" caused public uproar. It turns out there really are two "Muji" brands, and this is already their second lawsuit. Faced with this situation, netizens lamented, "It's like Li Kui running into Li Gui." Today, the editor will analyze the grievances and entanglements behind this.

 

 
First lawsuit: Trademark rights dispute
Beijing Cotton Field Textile Co., Ltd. (hereinafter referred to as "Cotton Field") and Beijing Muji Investment Co., Ltd. (hereinafter referred to as "Beijing Muji") filed a lawsuit in 2015 with the Beijing Intellectual Property Court, alleging that Ryohin Keikaku Co., Ltd. (hereinafter referred to as "Ryohin Keikaku") and Muji (Shanghai) Commercial Co., Ltd. (hereinafter referred to as "Shanghai Muji") infringed upon their rights to the No. 7494239 and No. 1561046 "Muji" trademarks (collectively referred to as the "trademarks in question").
 
After four years, the two cases have finally been settled. Recently, the Beijing High Court issued final judgments in both cases, upholding the original rulings, which found that Ryohin Keikaku and Shanghai Muji constituted infringement, ordered an immediate cessation of the infringing acts, required the publication of a 30-day statement on Tmall's "Muji MUJI Official Flagship Store" (muji.tmall.com) and in physical stores in mainland China to eliminate the impact of the infringement, and awarded a total of 102 yuan in economic damages and reasonable expenses. (First instance case numbers: (2015) Jing Zhi Min Chu Zi No. 763 and 764; Second instance case numbers: (2018) Jing Min Zhong No. 171 and 172)
 
After the Beijing High Court issued the final judgments, Ryohin Keikaku and Shanghai Muji promptly published the following statement on the "Muji MUJI Official Flagship Store":

 

 
 
The second lawsuit: Commercial defamation and unfair competition
As seen from the above trademark dispute cases, the defendant, Japanese Muji, lost the case and was required to cease infringing on the exclusive rights to the registered trademarks of Beijing Cotton Field Company and Beijing Muji, and to issue a statement to eliminate the impact of the infringement.
 
However, it is noteworthy that in the statement, the defendant used the term "squatting." Consequently, Beijing Muji filed a lawsuit against Japanese Muji, arguing that the use of the term "squatting" harmed its business reputation and constituted unfair competition. Therefore, Beijing Muji claimed 3 million yuan in compensation and 100,000 yuan in legal fees. Cui Shulei, a judge in the Intellectual Property Division of the Beijing Chaoyang District People's Court, pointed out that whether Japanese Muji constituted commercial defamation against Beijing Cotton Field Company primarily depends on the definition of commercial defamation under the Anti-Unfair Competition Law. The case was not pronounced in court.
 
 
[1] The author's perspective
I believe everyone is familiar with Japan's Muji, which became popular in Japan as early as the last century. However, despite this, Muji only entered the Chinese mainland market for the first time in 2005. Therefore, when the "Muji" trademark appeared in China at that time, Japan's Muji strongly objected and even filed lawsuits to no avail. The Supreme Court ruled in this case that since Japan's Muji had not entered the Chinese market before the domestic enterprise's application date, even though it had high popularity in Japan and other countries and regions globally, this popularity did not provide protection in the Chinese market.
 
Thus, it can be seen that from an international perspective, trademark rights are territorial. Both China and Japan are members of the Paris Convention, which includes a very important principle known as the "right of priority." The "right of priority" means that if an applicant from any member country first files a trademark registration application in one member country and then files the same application in another member country within six months, the other member country shall regard the date of the first application as the filing date, granting the applicant priority rights. Within the priority period, even if a third party files an application or uses the trademark, the applicant still obtains exclusive trademark rights due to the priority. Clearly, Japan's Muji did not make good use of this principle, leading to its current awkward situation.
 
The author reminds that under the current trend of international economic and trade development, companies are increasingly focusing on the protection of intellectual property. Some of our traditional brands have been registered abroad by others in advance, which not only makes it more difficult for Chinese brands to enter foreign markets but may even jeopardize their legitimate use in their home country. Although the priority principle in the Paris Convention does not use the acquisition of trademark rights as a measure, prior application is still a very important factor in obtaining trademark rights. In summary, companies need to improve their trademark rights and other intellectual property to avoid laying hidden dangers for the future.