Ho I Lock Co., Ltd. violated the Fair Trade Law in using false and misleading representations for the sales of it's A-locks and through engaging in obviously unfair acts capable of affecting the trading order
Chinese Taipei
Case:
Ho I Lock Co., Ltd. violated the Fair Trade Law in using false and misleading representations for the sales of it's A-locks and through engaging in obviously unfair acts capable of affecting the trading order
Key Words:
patent, effective competition, false and misleading
Reference:
Fair Trade Commission Decision of August 15, 2002 (the 562nd Commissioners’ Meeting); Letter (91) Kung San Tzu No. 0910008034 and Disposition (91) Kung Ch'u Tzu No. 091125
Industry:
Other Fabricated Metal Products (2499)
Relevant Law:
Summary:
1. This case originated with a complaint alleging Ho I Lock Co., Ltd. (Ho I) of printing on the packaging case of its A-locks the statement that the goods sold by Tellurium Industrial Co., Ltd. (Tellurium) and Micro Hardware International Co., Ltd. (Micro Hardware) were counterfeits, but that in fact the patent application rights and patent rights for the utility model patent “Improved Structure of Steering Wheel Lock” were vested in Tellurium. In addition, Ho I stated on its website that it was established in 1991 and printed on the packaging cases of its 7th-generation goods the wording that “today’s success is based on our eight years as a company.” The company, however, was actually incorporated in the year 1997. Based on the above, Ho I was alleged to have violated the Fair Trade Law.
2. Through investigation, the Fair Trade Commission discovered that on 1 August 2000 the Intellectual Property Office under the Ministry of Economic Affairs, based upon a photocopy of the Taiwan High Court (Tainan Branch) Criminal Judgment (86) Shang Yi Tzu No. 1928, concluded that a Mr. Ho (the actual responsible person of Ho I), the patent owner of the New Utility Model Patent No. 117639 referred to by the complainant, had been employed by Tellurium since 26 December 1995. When the application for the patent was filed, Ho was still employed by Tellurium. Therefore, the new utility model was deemed as being made within the scope of his employment, and the patent applications rights and the patent rights concerned should be vested in Tellurium. In addition, Ho I argued that the company was formally established in 1991 under the name of Yuan Chia Corporation (Yuan Chia), and Ho I's responsible person, Liao Tsai-yen, was also the responsible person of Yuan Chia. The Chiayi County government business license submitted by Ho I, however, showed that the actual registered approval date for its establishment was 3 July 1997, with its items of business registered as sales of anti-theft lock sets for cars and import/export trade. On the other hand, the approval date for establishment of Yuan Chia was 4 January 1992, with business items registered as sales of various hardware products (smoking accoutrements), skateboards, exercise equipment, and brass objects. These facts conflicted with the contents of A-lock advertisements that “Ho I Lock Co., Ltd. was established in 1991.” The two companies also differed completely in their business items. The packaging cases of Ho I's 7th-generatioin goods were printed with the words that “today's success is based on our eight years as a company,” a statement contradictory to the fact that the valid term of Ho I’s first patent (New Utility Model Patent Certificate No. 92942) is from 21 August 1994 to 27 February 2004 and that the A-lock Trademark was registered on 16 January 1997. Neither was the time span from either of the two dates listed above to the filing date of the complaint eight years as long as Ho I claimed.
3. Based upon the conditions listed above, it was evident that Ho I’s 7th-generation A-lock product was the New Utility Model Patent No. 146802 and was different from the New Utility Model Patent No. 117639 disputed between Ho I and Tellurium. Ho I used advertisements with irrelevant patent and trademark rights to disparage its competitors and to promote sales of its goods, thus violating Article 24 of the Fair Trade Law by engaging in obviously unfair acts against its competitors and by obviously hindering the essence of effective competition. It also made false representations by claiming on it’s A-locks that “Ho I Lock Co., Ltd. was established in 1991” and on the packaging cases of its 7th-generation goods that “today's success is based on our eight years as a company,” thus violating Article 21(1) of the same law.
Appendix:
Ho I Lock Co., Ltd.’s Uniform Invoice Number: 16035130
Summarized by Lai, Mei-Hua; Supervised by Wu, Jack T.H.