by Joy Dong
In a notable decision reinforcing the standards of trademark use and enforcement in China, the Songjiang District People’s Court of Shanghai ruled in favor of a well-known textile company in a trademark infringement lawsuit involving deceptive trademark manipulation and improper use of registered marks.
The ruling sheds light on how “partial logo highlighting” and “trademark camouflage” can lead to legal liability, even when the accused party owns a registered trademark.
Case Background: “Meiluolai” vs. “Luolai”
The plaintiff, a leading domestic textile company, owns the registered trademark “Luomou (罗某)”, designated under Class 24 for goods such as quilts, blankets, and other bedding materials.
The defendant, an electrical appliance manufacturer, legally registered the mark “Meiluomou (美罗某)” under Class 11 for electric blankets. However, when marketing its products, the defendant visually emphasized “Luomou” while subtly minimizing or artistically altering the “Mei” (美) portion, making the “Meiluomou” mark nearly indistinguishable from “Luomou” in consumers' eyes.
The textile company filed suit, claiming the packaging created confusion among consumers and constituted trademark infringement. The defendant argued that:
The plaintiff’s trademark was not registered in Class 11 (electric blankets), and thus had no coverage in this category.
The products bore their own registered trademark “Meiluomou” and were unlikely to cause confusion.
Court’s Findings: Similar Goods, Improper Use
The court ruled decisively in favor of the plaintiff, holding that:
1. Similar Goods Standard
Though listed under different classes, electric blankets (Class 11) and blankets (Class 24) are functionally and commercially related: Both serve similar purposes (warmth, home use), both are sold in overlapping channels, they target the same consumer demographic.
Hence, they were legally considered “similar goods” under China’s Trademark Law.
2. Improper Trademark Usage
While the defendant legally registered “Meiluomou,” the court found its use of the mark on packaging was non-standard:
The design obscured the “Mei” character, making “Luomou” the prominent visible element,
This visual presentation exploited consumer familiarity with the plaintiff’s brand, a tactic akin to “trademark masking.”
This “highlighting and hiding” strategy was judged as a clear instance of unfair use, violating both the letter and spirit of the law.
Court’s Ruling
The court ordered the defendant to:
Immediately cease using packaging that infringes on the plaintiff’s trademark rights;
Pay ¥100,000 RMB in damages, including legal and enforcement costs.
No appeals were filed. The case is now closed.
Legal Analysis: Why This Case Matters
A. Trademark Use Must Be Honest and Consistent
Owning a trademark registration does not give license to manipulate its visual presentation in ways that mislead consumers. Companies must:
Use registered marks as approved, without disassembling or reinterpreting key elements,
Avoid obscuring or highlighting portions of a trademark that could create brand confusion.
This is a crucial reminder that formality alone (i.e., registration) does not excuse bad-faith or deceptive conduct in the marketplace.
B. What Are “Similar Goods”?
Chinese courts use a functional and commercial relatedness test: Even if products fall under different classes in official classification tables, if they are perceived by consumers as related or interchangeable, they can be deemed similar goods under the law.
This approach protects consumers and brand owners from unfair competitive practices in adjacent markets.
C. Partial Highlighting = Infringement
The case illustrates how “trademark dilution by design” (a strategy where one part of a brand is highlighted and others are hidden) can cross into infringement. This reflects a maturing IP ecosystem that recognizes modern marketing tricks and addresses indirect infringement tactics.
Final Thoughts: Lessons for Brand Owners
This case provides an important precedent for IP rights enforcement in China:
Registering a trademark is only the first step: how it is used in practice matters greatly.
Visual manipulation to mimic or exploit better-known brands may result in liability, regardless of formal ownership.
Companies must prioritize genuine branding and compliance, rather than seek shortcuts.
Photo cover by Anastasiia Ornarin on Unsplash