Judicial Points

Where the operator of a defendant, having previously been identified as an infringer and held liable for civil responsibilities by an effective judgment for committing trademark infringement, repeatedly implements similar infringing acts through a newly established individual industrial and commercial household as a vehicle and under an identical or highly similar business model, the court shall pierce the surface liability of the individual industrial and commercial household to clarify that the operator is the actual controller. Based on the operator's subjective malice in repeated infringement, the intent to evade legal liabilities, and the market confusion caused by the infringing acts, punitive damages shall be applied to the individual industrial and commercial household controlled by the operator.

Case Number

First Instance: Shanghai Yangpu District People’s Court (2025) Hu 0110 Min Chu No. 580

Case Summary

Guangzhou Liby (Bai) Company is the right holder of the "Kispa" (好爸爸) trademark, with a registered scope of use including "laundry powder." The plaintiff discovered that the defendant, Xiao-XX Daily Necessities Department Store, used the plaintiff's identifiers and implemented infringement without authorization. The "Kispa" laundry powder sold in the store opened by the defendant on a certain e-commerce platform was an infringing product, which infringed upon the trademark rights enjoyed by the plaintiff regarding "Kispa." Huang Mouwei, the operator of the defendant Xiao-XX Daily Necessities Department Store, had previously opened a store on another platform to sell products infringing upon the plaintiff's trademark rights and was identified as an infringer by the Fujian High People's Court and ordered to bear infringement liability. Therefore, the current infringing act constitutes a repeated infringement. The plaintiff filed a lawsuit with the court requesting the application of punitive damages and seeking an order for the defendant to compensate for economic losses and reasonable expenses paid to stop the defendant's infringing acts totaling RMB 80,000.

The court of first instance held upon trial that the plaintiff’s registered trademarks enjoy high reputation, and as a business entity of daily chemical products, the defendant should have a high duty of care. However, the defendant introduced, displayed, and sold laundry powder products bearing the plaintiff's identifiers in the involved store, failing to provide either a basis for trademark authorization or evidence of a legitimate source of the goods. Given that the defendant’s operator, Huang Mouwei, had been identified by a court as having committed trademark infringement for selling the plaintiff’s "Liby" (立白) brand laundry powder products in a store on a certain platform, and yet continued to open a store on an e-commerce platform to sell laundry powder products infringing upon the plaintiff's "Kispa" trademark rights, it is evident that his intent was obvious. Furthermore, this situation meets the statutory circumstance of again implementing similar infringing acts and constitutes serious circumstances, satisfying the conditions for the application of punitive damages. The court ruled that the defendant shall compensate the plaintiff for economic losses, including reasonable expenses paid to stop the infringement, totaling RMB 40,000.

After the first-instance judgment, neither party filed an appeal, and the first-instance judgment has entered into force.