Yamaha Motors recently won the highest damages ever awarded to a foreign company for trade mark infringement in China when China’s Supreme Court ordered domestic motorcycle manufacturer Zhejiang Huatian to pay Rmb8.3 million ($1.1 million) in damages to Yamaha, upholding an earlier decision of the Jiangsu Higher People’s Court.
Zhejiang Huatian set up a shell company in Japan called Nippon Yamaha Co in 2000, which then entered into a trade mark licensing agreement with Zhejiang Huatian. The Chinese company claimed that this allowed it to manufacture motorcycles in China using the name Yamaha. The Court accepted Yamaha’s argument however, that all the parties knew that they were infringing the Japanese company’s trade mark.
The importance of the ruling is that it appears that China is continuing to take trademark infringment and passing off more seriously than in the past.
