Perspective | How to Respond When the Defendant in Trademark Infringement Cases Uses Infringement Profits as a Basis for Compensation
Published:
2024-12-31
In this case, the Administrative Penalty Decision made by the C Supervision and Administration Bureau determined that the value of goods for Company B was 24,500 yuan, the illegal business amount was 31,166 yuan, and the illegal income was 1,018 yuan. However, the aforementioned decision did not actually ascertain and determine the actual profits obtained by Company B during the entire business period due to the infringement of the trademark logo involved in the case of Company A. The purchase lists, sales lists, and explanatory statements provided by Company B were unilaterally prepared by the defendant Company B, without any third-party signatures or seals, and there were no financial books or other evidence to support this. Therefore, it is insufficient to prove their profits from the infringement, and thus, statutory compensation should apply in this case.
Summary of the Judgment
In this case, the administrative penalty decision made by the B market supervision administration determined that the value of goods of Company B was 24,500 yuan, the illegal operating amount was 31,166 yuan, and the illegal income was 1,018 yuan. However, the above decision did not actually ascertain and determine the actual profit obtained by Company B during the entire operating period due to the infringement of the trademark of Company A involved in the case. The purchase list, sales list, and explanation provided by Company B were unilaterally produced by the defendant Company B, with no third-party signatures or seals, and there was no financial account book or other evidence to support it. Therefore, it is insufficient to prove its infringement profits, and thus statutory compensation should apply in this case.
Case Summary
The plaintiff Company A's factory was established in 1943. After more than 80 years of development, it has the most complete product system in the country. The trademarks held by the plaintiff and the products produced have successively won titles such as "China Famous Trademark", "Jiangsu Province Famous Trademark", "15th National Quality Award", and "National Science and Technology Progress Award", making it a national brand of China.
On November 1, 2021, the B market supervision administration received a complaint and conducted an on-site inspection of Company B's warehouse, creating a "现场笔录" (on-site record), taking on-site photos, and implementing administrative seizure measures on the infringing goods involved in the case. The B market supervision administration determined that Company B purchased a large number of goods infringing on the exclusive rights of the registered trademark of plaintiff Company A from sales personnel without purchase lists, contracts, invoices, or other purchase vouchers. It was calculated that the illegal operating amount of Company B totaled 31,166 yuan, with illegal income of 1,018 yuan. The B market supervision administration believed that the seized goods involved in the case belonged to goods infringing on the exclusive rights of the registered trademark of plaintiff Company A. Therefore, on March 9, 2022, the B market supervision administration issued an "administrative penalty decision", ordering the defendant Company B to immediately stop the infringement, confiscate the relevant infringing goods, and impose a fine of 50,000 yuan. Company B did not raise any objections to this decision and has fulfilled all its obligations according to the decision.
During the trial, the defendant Company B argued that the compensation amount for infringing the exclusive trademark rights should be determined by multiplying the sales volume of Company B by the unit profit of the goods. The specific amount was 1,018 yuan. The court believed that the above decision did not actually ascertain and determine the actual profit obtained by Company B during the entire operating period due to the infringement of the trademark of Company A involved in the case. The purchase list, sales list, and explanation provided by Company B were unilaterally produced by the defendant Company B, with no third-party signatures or seals, and there was no financial account book or other evidence to support it. Therefore, it is insufficient to prove its infringement profits, and thus statutory compensation should apply in this case.
Judgment Result: 1. The defendant Company B shall immediately stop selling goods that infringe on the exclusive rights of the registered trademark of the plaintiff; 2. The defendant Company B shall compensate the plaintiff Company A for economic losses and reasonable expenses of 48,000 yuan within ten days from the date this judgment takes effect.
Insights from Handling the Case
In trademark infringement cases, the purchase lists and sales lists submitted by the defendant must prove their actual profits obtained during the entire operating period due to the infringement of the trademark of Company A involved in the case. The purchase lists, sales lists, and explanations provided by the defendant were unilaterally produced by the defendant, with no third-party signatures or seals, and there was no financial account book or other evidence to support it. Therefore, it is insufficient to prove its infringement profits, and thus statutory compensation should apply in this case.
Key words:
Zhongcheng Qingtai Jinan Region
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