Rouse China secures precedent-setting judgment for New Balance in China

Boost for brand owners seeking IP protection in China as key member of Rouse China team predicts market change

New Balance has won a rare legal victory in China in an intellectual property dispute: a Chinese civil court has, in a first instance judgment, ordered infringers to pay an eight-figure sum for using the American shoemaker’s signature slanting logo. The first instance judgment from Suzhou Intermediate People’s Court was issued yesterday (17th August, China local time), and the court upheld almost all New Balance claims, including an order that the defendants pay damages and legal costs of RMB 10 million (around US$1.47 million).

Rouse, together with its associated law firm Lusheng in China, advised New Balance on the case.

A decision of this nature is precedent-setting and will have a significant and positive impact on how foreign brand owners, especially in the fashion sector, protect their intellectual property in China. In practice, it is extremely rare for the Chinese courts to issue such a high level of damages for trade mark infringement or unfair competition, and even more remarkable in this case given that the award is far in excess of the maximum statutory amount that could be claimed (RMB 3 million).  

Angela Shi, Brand Protection Manager, New Balance

“Nowadays, foreign brand owners like us are facing increasingly aggressive lookalike infringements in China on a scale we don’t see in other major markets. The winning of this case has given us confidence to continue our proactive brand protection strategy in China. “

Carol Wang, Head of Shanghai litigation team, Lusheng

 “The civil court has applied every possible remedy at its disposal, including issuing an interim injunction, rare in itself, that makes it far more difficult for the infringers to keep operating. Combined with punitive damages payments and fines for non-compliance, the Suzhou court has issued the sort of decision that would stand up in any court of the world.

“Although this sort of decision is still rare, it sends a strong and powerful message that should make it that little bit easier for foreign brands doing business here.

Luke Minford, Chief Executive Officer, Rouse

“This is a victory for confidence. Confidence in the courts, confidence in New Balance’s ability to invest and feel protected, confidence in the mind of the consumer that they’re buying the real thing. The job ahead of all of us now is to ensure this confidence is not short-lived.”