Tesla Motors planned to sell its Model S in China as of 2013. It’s already doing so in the U.S. and Europe. However, the sale of the cars, made in California and the Netherlands, have been stalled allegedly partly by a trademark squatter/troll or more politically correct “an entity using the trademark not in a trademark sense”. Reuters wrote that Zhan Baosheng registered the Chinese trademark in 2006 for a logo at Jinda Trademark agency in Guangzhou, that seems identical, apart from the TESLA lettering which is a bit different. The car on the Zhan’s Tesla Motors site is similar to Tesla Model S, is likely to confuse consumers and it seems not too difficult to claim copyright infringement.
What about trademark infringement?
Article 14 of China’s Trademark Law states:
Account shall be taken of the following factors in the establishment of the well-known mark:
1. reputation of the mark to the relevant public;
2. time for continued use of the mark;
3. consecutive time, extent and geographic area of advertisement of the mark;
4. records of protection of the mark as a well-known mark, and;
5. any other factors relevant to the reputation of the mark.
The trademark Tesla has been used since 2003. One can argue that at least the last 7 years it has a reputation world wide in the market for electric cars. One can also argue that the defendant by setting up a site with copyright infringing computer renditions of a car similar to Tesla Model S has not really made use of the trademark in the trademark sense (has not made use of the trademark in the course of trade). Article 41 Trademark Law explicates that if a well known mark was registered in bad faith the limitation to dispute the approval of a trademark with the Trademark Review and Adjudication Board (TRAB) does not count.
Danny Friedmann
Read also Reuters’ article written by Norihiko Shirouzu and Samuel Shen here. More about Well known trademarks in China, read Wan Jun’s terse article Well-known Trademark Certification: Practical Thinking of “Dual-track System” in China IP Magazine, here. Or Jing “Brad” Luo & Shubha Ghosh”s scholarly work “Protection and Enforcement of Well-Known Mark Rights in China: History, Theory and Future” in the Northwestern Journal of Technology and Intellectual Property 2009, see here.
UPDATE (August 7, 2014) : The China Daily reports that Tesla’s CEO Elon Musk and Chinese businessman Zhan Baosheng came to a settlement and resolved the trademark dispute, read here.