By Skye Zou
Changing the operator of an online store may change what appears on paper, but it does not necessarily change who is responsible for trademark infringement.
A recent judgment by the Fujian High People's Court illustrates this point. The court upheld an RMB 8 million damages award in a trademark infringement dispute involving New Balance, finding that several individuals and an e-commerce company had acted together to sell sports shoes bearing a mark similar to a protected New Balance trademark.
Background of the case
The relevant registered trademark, No. 5942394, is owned by New Balance Athletic Shoe, Inc. and covers sports shoes and other goods in Class 25. New Balance Trading (China) Co., Ltd. was authorized to use the trademark in China and to independently bring legal proceedings against infringers.
The defendants were five individuals, identified in the judgment as Chen A, Chen B, Zhuo, Zheng and Chen C, together with an e-commerce company based in Putian, Fujian.
The defendants successively operated two Taobao stores called "New Balance Authentic Discount Mall" and "New Balance Official Online Store". The stores sold sports shoes bearing the allegedly infringing sign.
According to the court, the two stores generated sales of more than RMB 78 million in total between September 2021 and September 2024.
Changing the Store Operator Did Not End the Connection
The defendants argued, in effect, that the different individuals and company operating the stores were separate business entities, each responsible only for its own period of operation.
The court took a different view.
It examined the relationships between the parties, including their family connections, shareholding arrangements and the continuity of their commercial activities. It also considered practical evidence such as the delivery addresses, telephone numbers, product information and product links used by the stores.
Trademark Similarity Was Assessed by Looking at the Key Features
The court also considered whether the sign used on the defendants' products was similar to the registered New Balance trademark.
It found that the allegedly infringing sign incorporated the most identifiable design features of the registered trademark. The fact that additional design elements had been added did not eliminate the similarity.
This reflects an important principle in Chinese trademark litigation. The assessment of trademark similarity is not simply a matter of counting visual differences.
Courts consider whether the key features of a protected trademark have been reproduced in a way that may cause consumers to associate the allegedly infringing sign with the trademark owner. This is also consistent with Article 57(2) of China’s Trademark Law, under which the unauthorized use of a sign similar to a registered trademark on identical goods constitutes infringement where confusion is likely.
Why 8 Million RMB (1,195,200 USD) ?
The scale of the online sales was central to the damages assessment. Where actual sales data are available, they provide an objective basis for calculating compensation.
The first-instance court awarded 8 million RMB in damages. The defendants appealed, but the Fujian High People’s Court dismissed the appeal and upheld the original judgment.
What the Case Means for E-Commerce Businesses
The decision is important for businesses involved in online retail and brand protection in China.
For brand owners, this approach provides an additional tool for tackling sophisticated online infringement. It can be particularly important where infringing businesses attempt to distribute their activities among relatives, affiliated companies or successive store operators.
For online sellers, the case is a reminder that trademark compliance cannot be treated as a matter of corporate formality. Individuals and companies involved in a coordinated infringement operation may face joint liability even where their formal roles change over time.
A Broader Trend in China Trademark Protection
The New Balance case reflects a broader development in Chinese intellectual property enforcement. As e-commerce businesses become more sophisticated, trademark infringement can also become more organized and difficult to trace.
Chinese courts are increasingly willing to examine the practical relationship between different participants rather than relying solely on corporate registrations or the name displayed on an online store.
For international brands operating in China, the case therefore highlights the importance of monitoring not only individual infringing listings but also the wider network behind them.
In China's rapidly evolving e-commerce environment, effective trademark protection increasingly requires looking beyond the storefront to identify who is actually controlling and benefiting from the infringing business.