Fengxing Dairy Failed in Appealing in Packaging Infringement

Fengxing Dairy Failed in Appealing in Packaging Infringement Case, Compensating Yantang Dairy 600,000 Yuan

The second-instance judgment of the state-owned brand Guangdong Yantang Dairy’s suing against Guangzhou Fengxing Dairy Co., Ltd. for unfair competition was released: Fengxing Dairy’s appeal was invalid, and it should stop using the packaging and decoration similar to Yantang Dairy’s on related commodities. Fengxing Dairy should compensate Yantang Dairy for economic losses and rights protection expenditure totaling 600,000 Yuan.

On December 19, 2017, Yantang Dairy sued Fengxing Dairy to the court and demanded it to stop the infringement of the packaging and decoration of its well-known products, such as the “pure milk” and “original yogurt drinks”, and compensate for economic loss of 1 million Yuan.

Yantang Dairy believes that “Yantang” milk brand originated in 1956 and has a high reputation and a good fame. Its packaging is designed to be milk poured from one side and splashed the other side. It is very recognizable by consumers and is a unique packaging decoration for well-known products. Fengxing Dairy used similar packaging and decoration to Yantang Dairy’s well-known products in the production and sale of “pure milk” and “original yogurt drinks” without permission. The overall design, layout of elements, color selection, and patterns, etc., caused confusion between the two commodities, and let consumers misunderstand the source of the commodities. Its behavior is suspected to constitute unfair competition.

On April 24, 2018, the Tianhe District People's Court of Guangzhou Municipality ruled that Fengxing Dairy must immediately stop using similar product decoration to Yantang’s on its related products, and compensate Yantang Dairy for economic losses and rights protection expenses totaling 600,000 Yuan. Fengxing Dairy refused to accept the decision and immediately appealed. According to the judgment of the second instance, the appeal was rejected and the court upheld the original judgment.

Yantang Dairy said that the company will urge the execution of the judgment in accordance with the law. If the funds are received, it will have certain positive impact on the company’s current profits. In the first half of 2019, Yantang Dairy’s revenue was 699 million Yuan, a year-on-year increase of 13.85%; net profit was 66.5081 million Yuan, an increase of 57.06%.

According to industry and commerce bureau’s information, Fengxing Dairy was established in 1985. The controlling shareholder is Guangzhou Fengxing Milk Co.,Ltd., which has supplied fresh milk to Hong Kong for 30 consecutive years. In August 2017, Fengxing Dairy acquired the old dairy brand Zhangjiakou Great Wall Dairy in Hebei Province, trying to enter market outside the province.

 

 

September 11, 2019

Source: The Beijing News

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