Use of a Generic term V.S a Trademark Infringement

What will be shown in your mind when ‘优盘’ was mentioned? Shenzhen Netac Company’s trademark, or a mobile storage tool? The
answer is probably the latter. In fact, Shenzhen Netac Company has registered ‘优盘’as a trademark in 1999, and used it on the
company’s mobile storage products. In Oct. 2002, a Beijing company applied for the revocation of this trademark with the reason
that it is a generic term. The trademark bureau decided to revoke this trademark, then Beijing first medium court decided the
bureau to retrial, and finally the bureau still decided to revoke it. Recent years, such dispute is not rare, such as the ‘解百纳’ case
and ‘金骏眉’ case and etc.

A generic term refers to the term which is a conventional saying and be used on a certain types of goods (service) in a certain range.
(Note: Quote from ‘Baidu Encyclopedia’) According to Article 11 of the ‘Trademark Law’, if a trademark is only compounded with a
generic term, then such trademark could not be registered. Because a generic term could not be used to distinguish the origin of
goods. An exception is while such sign has been used and obtained a distinctiveness, which is easily to be identified, and then it
could be registered as a trademark.

In practice, there is another circumstance ‘Generic Trademark’, which means a registered trademark could be used to distinguish the
origin of goods, with the frequent use of this registered trademark, it becomes a generic term for a certain type of goods instead of
the symbol of a specific goods. ‘优盘’ case in the beginning is a typical case.

For the users despite the trademark right owner, how to identify whether the term or symbol planned to be used is a generic term?
Generally speaking, the ‘Opinions of the Supreme People’s Court on Several Issues Concerning the Trial of Administrative Cases
Involving the Authorization and Determination of Trademark Rights’(hereinafter referred to as the ‘Opinions’) could be taken into
reference. Article 7 of the ‘Opinions’ has prescribed, ‘in judging whether a disputed trademark is a generic term, the court shall
check whether it is a goods name formed by law or established by usage. A trademark shall be determined as a generic term if it fits
the descriptions of any law, national standards or industrial norms. A trademark shall be determined as a generic term established by
usage if it is generally recognized by the relevant public that the name refers to a certain category of goods. Where a trademark is
listed as a goods name by a specialized reference book or thesaurus, this fact shall be taken into account for deciding whether it is a
generic term established by usage. The judgment of a generic term established by usage is generally based on the common sense of
the relevant public nationwide. For goods for which relatively stable markets have been established due to historical tradition, social
customs, geographic environment and other causes, titles universally accepted in these markets can be determined as generic
terms. ……’ In addition, Article 8 of the ‘Opinions’ has prescribed, ‘a court shall decide whether a disputed trademark is a generic
name based on the factual state at the time when the trademark registration application is filed…….’

According to Article 49 of the ‘Trademark Law’, if a registered trademark becomes the generic term of the authorized goods, then
such registered trademark could be the object of revocation. In regard of the above regulations, if the party other than the
trademark right owner has decided a registered trademark shall be a generic term, then this party could apply for the revocation of
this registered trademark, which can prevent this party from the legal risks by using the registered trademark.

It is time consuming to apply for the revocation of those registered trademarks which might be identified as a generic term.
Practically speaking, the party could use the generic registered trademark by taking advantage of Article 59 of the ‘Trademark Law’,
which says the registered trademark right owner could not prohibit the other parties to fair use the registered trademark which
contains the generic term of the authorized goods.

However, in order to avoid being determined as a trademark infringement action by using a registered trademark while using a
generic term, the user shall fair use such registered trademark. For example, if a generic registered trademark is part of a whole
symbol on the goods, then it shall not be marked obviously, and it would be better to be distinguished from the registered
trademark on the character, picture, size and etc.; or while using more than one logo / term, it would be better to keep the
consistency of the font, size, color of the generic registered trademark and other logo / term.