| 1. |
The case originated from the complaint filed by Kinmen Kaoliang Liquor
Inc, (hereinafter referred to as the "complainant") alleging that:
| (1) |
The complainant has manufactured the earthen jarred "Kinmen Superior
(sorghum) Liquor" since 1983 and commissioned the ceramics factory in Kinmen
County to produce the earthen jars for the liquor with traditional porcelain.
In addition to the hemp rope like design and the protruding ear-like handles,
the jar also has a special "dragon pattern." Such a dragon pattern has
the same shape as the dragons of the "two-dragon pattern," for which the
complainant is famous, only that the posture is slightly different. Consumers
can immediately associate one with the other as the related products. The
outer packing box is red with golden edgings and the words "Fu (bless)"
and "Shou (Life)" printed in golden color. After the Alcohol and Tobacco
Administration Act was enforced in 2002, the product information is indicated
on the new packing boxes in compliance with the regulations. The production
volume of 1 kg packed "Kinmen Superior Liquor" in 1999, 2000, and 2001
was 96994, 405075, and 606739 bottles; and the sales volume was 89976,
381563, and 638840 bottles. In light of the increment, it can be found
that after decades of efforts in the marketing, relevant enterprises and
consumers have already known well about the earthen jars with the dragon
pattern and ear-like handles and the red packing boxes with golden edgings;
therefore, they shall undoubtedly qualify as the symbol of famous goods, |
| (2) |
With regard to the product "Dragon-Headed Wind Lion God" manufactured
and sold by the respondents, the symbol the respondents use is very similar
to the jars and old packing boxes of the complainant's product "Kinmen
Superior Liquor." The identical parts of the two products are the pattern
on the packing boxes, exterior picture of the porcelain jars, color of
the jars (both white), and the bottle shape. Consumers can easily mistake
that two products are the same or from the same production and marketing
subject when purchasing in the market. The respondents'act obviously violated
Article 20(1)(i) or Article 24 of the Fair Trade Law. |
| (3) |
The Wind Lion God on the product "Dragon-Headed Wind Lion God" holds
the same object as the statute of the Wind Lion God outside of the Kinmen
Airport, which is obviously a deliberate imitation. The respondents combined
"Dragon-Headed" and "Wind Lion God" and used the name for the sorghum product
to confuse the public and misled the consumers into believing that the
said product or the company is from Kinmen. Besides, after removing the
words "Dragon-Headed" on the packing box, it was found that the original
label showed "Kinmen." Therefore, the original product name was "Kinmen
Wind Lion God." The product is not produced in Kinmen, but the label used
indicates Kinmen as the place of origin, in violation of Article 21(1)
and (2) of the Fair Trade Law. |
|
| 2. |
Grounds for the administrative decision:
| (1) |
With regard to whether this case involves with a violation of Article
20(1)(i) of the Fair Trade Law:
| I. |
The elements of a violation under Article 20(1)(i) of the Fair Trade
Law are: (1) symbols commonly known to relevant enterprises or consumers;
(2) using in the same or similar manner the symbol that represents other
person's goods; and (3) causing confusion with such person's goods. If
not falling under the symbol "commonly known to relevant enterprises or
consumers" as prescribed in the provisions, Article 20 of the Fair Trade
Law shall not be applicable. |
| II. |
The complainant claimed that the earthen jars with the dragon pattern
and ear-like handles and the red packing boxes with golden edgings of the
"Kinmen Superior Liquor" are the symbol of the famous goods, commonly known
to relevant enterprises and consumers. However, comparing the production
volume and sales volume of the said product with those of the "Kinmen Superior
Sorghum Liquor" (from 1999 to 2001), the volume of the former is less than
5% of that of the latter. In addition, the former product uses "tradition
porcelain made jars with the dragon pattern," which is completely different
from the appearance of the latter product, which uses "clear glass bottles
with long neck and round body shape and the two-dragon pattern." Therefore,
it is hard to recognize that the earthen jarred "Kinmen Superior Liquor"
is the symbol "commonly known to relevant enterprises or consumers" as
prescribed in Article 20(1) of the Fair Trade Law. |
| III. |
The complainant has several times provided the sales volume, amount,
and locations, orders, marketing direct mail, and books regarding the earthen
jarred "Kinmen Superior Liquor". However, the complainant also stated that
the product in question was mainly sold locally without entrusting any
agency. It was also found that, based on the orders and shipment notices
provided by the complainant, the earthen jarred "Kinmen Superior Liquor"
was sold to Nanlien Company from 1999 to 2002, and was mainly sold aboard
after 2002. The complainant did not provide any name list of distributors
or information of sales amount regarding the sales at major domestic stores.
Furthermore, the Fair Trade Commission (FTC) dispatched personnel to the
regular stores for investigation and did not find the complainant's jarred
"Kinmen Superior Liquor" was sold at the stores. It is obvious that the
earthen jarred "Kinmen Superior Liquor" is not widely sold domestically. |
| IV. |
In conclusion, based on the evidence, it is difficult to say that the
respondents violated Article 20(1)(i) of the Fair Trade Law by selling
earthen jarred "Dragon-Headed Wind Lion God." |
|
| (2) |
With regard to whether the case involves with the violation of Article
24 of the Fair Trade Law:
| I. |
Article 24 of the Fair Trade Law provides, "In addition to what is
provided for in this Law, no enterprise shall otherwise engage in any deceptive
or obviously unfair act sufficient to adversely affect trading order."
To determine whether an enterprise competes by using obviously unfair act,
extracts the fruits of another enterprise's hard work, or fails to comply
with business competition ethics, the considerations shall be given to
whether the target, which is free ridden on or highly plagiarized, receives
considerable efforts from such another enterprise, has certain economic
interests on the market, and is exploited by the act in question. The considerations
shall also be given to whether the result of the free riding or plagiary
misleads trading counterparts into believing that the two are from the
same source, the same series products, or belong to affiliate enterprises. |
| II. |
The complainant claimed that it commissioned the ceramics factory
in Kinmen to design the "dragon pattern" on the product "Kinmen Superior
Liquor" in 1983. The outlook of the jar shows the artistic conception that
ancient people carried the jarred liquor with hemp ropes and employs "dragons"
as the main theme of the design. However, it was found that the complainant
could not provide any evidence proving the "dragon pattern" design of "Kinmen
Superior Liquor" was its own creation. Besides, the dragon shapes, design
of the dragonheads, and patterns of the two jars are all dissimilar. Also,
the dragons and patterns are simply imitations of ancient tattoos, which
are commonly used on architectures, arts, and ceramics. The complainant
could not prove that it has put considerable efforts into the product "Kinmen
Superior Liquor" and that it has certain economic interests on the market. |
| III. |
It was also found that the marketing location of the complainant's
product "Kinmen Superior Liquor" is limited to the Kinmen area and the
commodity centers in northern, central, and southern Taiwan. It is not
commonly sold domestically. In addition to the fact that the complainant
could not provide evidence proving it has put efforts into the product
marketing, the complainant also could not prove that the respondents'act
has misled trading counterparts into believing the two products in question
are from the same source or the same series. Therefore, it is difficult
to determine that the complainant's economic interests have been exploited
by the respondents'act. |
| IV. |
To sum up, it is difficult to determine that the respondents violated
Article 24 of the Fair Trade Law by selling earthen jarred "Dragon-Headed
Wind Lion God" to plagiarize the complainant's symbol of goods, take a
free ride on the complainant's business reputation, or extract the fruits
of the complainant's hard work.
|
|
| (3) |
With regard to whether the respondents violated Articles 21(1) and
(2) of the Fair Trade Law:
| I. |
Article 21(1) of the Fair Trade Law provides, "No enterprise shall
make or use false or misleading representations or symbol as to price,
quantity, quality, content, production process, production date, valid
period, method of use, purpose of use, place of origin, manufacturer, place
of manufacturing, processor, or place of processing on goods or in advertisements,
or in any other way making known to the public." Paragraph 2 of the same
article provides, "No enterprise shall sell, transport, export or import
goods bearing false or misleading representations referred to in the preceding
paragraph." |
| II. |
Comparing the pattern on the packing box of the product "Dragon-Headed
Wind Lion God" with the picture of the Wind Lion God statute outside of
the Kinmen airport, both Wind Lion Gods hold the same object. Also, using
the combination of "Dragon-Headed" and "Wind Lion God" on the sorghum product
may confuse the public and mislead the consumers into believing that the
product or the company is from Kinmen. |
| III. |
In addition, referring to the trademark opposition decision Chung-Tai-Yi-Tzu
No. 890726 of the Intellectual Property Bureau, Ministry of Economic Affairs:
…Not a manufacture of Kinmen liquor, yet employed the "Wind Lion God"
that represents Kinmen as its trademark pattern per the registration application
No. 895136. Also, the designated sorghum liquor is one of the famous products
in Kinmen. It can easily mislead consumers into believing that the product
is from Kinmen and having confusion about the place of origin." Therefore,
the name or pattern of the "Wind Lion God" has become the mark of Kinmen.
Besides, sorghum liquor is one of the famous products in Kinmen. The respondent
is not a manufacturer of Kinmen liquor yet employed the "Dragon-Headed
Win Lion God" as its Chinese product name and used the pattern of "Wind
Lion God" on the outer packing box. It can mislead consumers into believing
that the said product is from Kinmen. |
| IV. |
In conclusion, the respondents violated Articles 21(1) and (2) of the
Fair Trade Law by using "Dragon-Headed Wind Lion God" as the product name
and the pattern of the "Wind Lion God" to manufacture and sell the jarred
goods in question. |
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