Over its eponymous trademark, American company Wyeth LLC had been entangling in an IPR battle with Guangzhou Wyeth Baby Products Co., Ltd. (Guangzhou Wyeth) for years in China.
Wyeth LLC was founded in 1926, formerly known as American Home Products Corporation, and changed into current name in 2009. Since entering the Chinese market in the 1980s, Wyeth LLC has applied for the registration of “惠氏” (Wyeth's transliteration), "Wyeth" and other trademarks in China, and has licensed many related companies to use them in China.
Wyeth LLC sued Guangzhou Wyeth and other five companies for trademark infringement and unfair competition at Hangzhou Intermediate People’s Court. Recently, the Court made the first-instance decision, ruling that the six defendants' acts of using Wyeth, 惠氏 (Wyeth's transliteration) and “惠氏 小狮子”(Wyeth Little Lion) in manufacturing and sales products, packaging and brochures constituted trademark infringement. One of the codefendants, Qingdao Wyeth's use of Wyeth in its corporate name constituted unfair competition. The Court held that the defendants' malicious infringement of Wyeth's good-will and brand name was obvious and therefore punitive damage was appropriate. Guangzhou Wyeth and other defendants were ordered to indemnify 30.55 million yuan in damages and reasonable legal costs. Wyeth LLC's financial claim was virtually fully supported by the Court.
When determining the compensation, the Court took into account the plaintiff’s high reputation in the market, the obvious malicious intent of trademark infringement, the duration and scale of infringement and that the products involved in the case could have a direct impact on the health and safety of infants and young children. As a result, the Court decides it is appropriate to apply punitive damages. According to the calculation, the defendant’s profit is more than 10 million yuan, whether it is based on the sales amount admitted by the online store, the dealer channel or the regional manager of Wyeth in Guangzhou. Therefore, Hangzhou Intermediate People’s Court fully supports the claims of Wyeth after calculating the compensation amount according to three times of the infringement profit.