Japanese retailer Muji has lost its trademark appeal to a Chinese firm.
Muji to pay Chinese firm & offer public apology
Muji was ordered to pay the Chinese firm RMB626,000 (S$120,740), and issue a public apology as well, South China Morning Post (SCMP) reported.
The Supreme People's Court in Beijing has upheld a 2017 ruling in favour of Natural Mill, which is owned by Beijing Cottonfield Textile Corp.
The Chinese parent company owns the trademarked name used by Muji, which is 無印良品 (pronounced wu yin liang pin in Chinese and muji ryouhin in Japanese).
This means that the Japanese chain can only be known as Muji in China, and not Wuyinliangpin, which is part of the Japanese brand's official branding since its founding in 1980.
Trademark does not cover all its goods in China
According to SCMP, when Muji entered the Chinese market -- its largest market outside of Japan -- in 2005, it trademarked its international brand name "MUJI" in block letters.
In addition, it took out a local trademark for the four Chinese characters to cover most of its goods, but not all.
Textile products such as towels, bed sheets and pillow cases were not covered under the trademark, Muji explained in an announcement posted on its Taobao page.
Back in 2001, Chinese company Hainan Nanhua had already taken out a trademark for Wuyinliangpin for certain fabric products, such as towels.
It later transferred the rights to the name to Beijing Cottonfield Textile Corp.
Chinese firms sued Muji in 2015
It was in 2015 that the two firms sued Muji for trademark infringement.
Two years later, the appeal court for intellectual property disputes in Beijing ruled in their favour.
Chinese firm says use of the name has nothing to do with Muji
Beijing Cottonfield Textile Corp maintained that its decision to trademark the Wuyinliangpin name had nothing to do with Muji, but was due to the fact that the firm only made good-quality products that had no dyes involved.
While Muji acknowledged that the Chinese firm holds the rights to the Wuyinliangpin name, it appealed against the supreme court's ruling on the basis that it had legally registered almost all its products under that name.
The court had disagreed, saying Beijing Cottonfield Textile Corp holds the "exclusive rights" to the trademark.
What is Natural Mill?
Natural Mill is widely seen among Chinese consumers as a counterfeit brand modelled after Muji.
Its branding, products, store concept, and prices are perceived to be similar to the Japanese retailer's.
The chain also uses the traditional Chinese characters that the Japanese retailer uses, despite simplified Chinese being the norm in China.
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