Erdos Company obtained the exclusive right to use the registered trademark “” on February 14, 2004. The trademark was approved to be used on the 25th category of scarves, clothing, gloves and other commodities. In June 2015, Erdos Company discovered that Miqi Company's "cashmere thread" products sold on its Tmall website "Miqi Apparel Store" highlighted the use of a prominent element in the trademark involved, that is, the Chinese text of "Erdos". Erdos Company filed an infringement lawsuit. The Beijing Intellectual Property Court held that the profit of Miqi from the alleged infringement could be determined by the product of the total number of infringing products sold, the unit price of the product, and the reasonable profit rate of the product. The "Erdos" series of Erdos Company's trademarks are well-known, and the profit margins of products in "Tmall" stores are higher. The implementation of the alleged infringement has caused more serious damage to the trademark owner. As an operator of goods closely related to clothing such as "wool, scarf thread, cashmere thread", Miqi Company should be aware of the popularity of the trademark involved. It prominently used the logo almost identical to the trademark involved in the case in its self-operated online store. The time of infringement was relatively long, subjective maliciousness was obvious, and the infringement was serious. The amount of compensation is determined based on twice the profit of Miqi Company due to the infringement.
This case fully demonstrated the people's court's confidence and determination to implement the punitive compensation system correctly and severely sanction malicious infringement of trademark rights. The reasoning part of the judgment document fully and clearly explained the factors that should be considered when determining "subjective malice" and determining the "base" and "multiples" of punitive damages. It made the process of judgment formation more transparent and the results of the judgment more persuasive. After the verdict of the case was pronounced, both parties did not appeal and achieved sound social effects.