Image: Valentino

A recent win for Valentino is set to have sweeping effects for brands when it comes to their abilities to fight unauthorized uses of their trademarks (or marks that are confusingly similar to their trademarks) in Taiwan. In a decision issued in March, Taiwan’s Grand Chamber of the Supreme Administrative Court sided with Valentino S.p.A. and blocked a third party’s bid to get the Taiwan Intellectual Property Office (“TIPO”) to register “GIOVANNI VALENTINO” for use on textiles and other fashion-related goods. In doing so, the court not only handed Valentino a win, but it settled a split in decisions about how to gauge whether a trademark is well known.

By way of background: Article 30(1)(11) of Taiwan’s Trademark Act stipulates that “a trademark shall not be registered” if it is “identical with or similar to another person’s well-known trademark, and hence, there exists a likelihood of confusion on the relevant public or a likelihood of dilution of the distinctiveness or reputation of the said well-known trademark.” Courts have issued differing opinions as to whether, in order for this provision to apply, a “well-known trademark” must be generally recognizable to: (1) General consumers or (2) Relevant enterprises or consumers.

In the case at hand, Valentino initiated an opposition proceeding with the TIPO (based on article 30(1)(11) of the Trademark Act), arguing that the defendant’s GIOVANNI VALENTINO mark was confusingly similar to its registered VALENTINO trademark. On the heels of the TIPO rejecting the opposition and in the wake of an unsuccessful administrative appeal with the Ministry of Economic Affairs, Valentino filed an administrative lawsuit to challenge the registration of the GIOVANNI VALENTINO mark. After the Intellectual Property Court (renamed the “Intellectual Property and Commercial Court”) rejected the administrative lawsuit, Mayhoola-owned Valentino lodged an appeal with the Supreme Administrative Court, which referred the case to the Grand Chamber of the Supreme Administrative Court. 

After a preliminary hearing in November 2022 and an oral argument in February 2023, the Grand Chamber of the Supreme Administrative Court issued its ruling, in which it made two critical determinations … 

– Article 31 of the Enforcement Rules of the Trademark Act states that the term “well-known,” as prescribed in the Trademark Act, refers to circumstances where there is objective proof that a trademark is capable of being commonly recognized by the relevant enterprises or consumers. The Examination Guidelines for the Protection of Well-known Trademarks under article 30(1)(11) of the Trademark Act contain the same provisions, and

– The 2003 amendment to Article 23 of the Trademark Act (i.e., Article 30 of the current Trademark Act), which governs dilution of a well-known trademark, did not increase the required recognition level of a well-known trademark such that it must be recognizable by general consumers.

The Key Takeaway: The court held that the term “well-known trademark” in Article 30(1)(11) refers to a trademark where the trademark holder can establish – by way of sufficient objective evidence – to identify that the mark is widely recognized by related enterprises or consumers, and that such recognition need not reach general consumers. 

With respect to the risk of impairing the recognition or reputation of a well-known trademark, courts should consider: (1) how well known the trademark is; (2) the degree of similarity between the two trademarks; (3) whether the trademarks are widely used on other goods or services; (4) the degree of innate or acquired recognition of the well-known trademark; and (5) whether the owner of the disputed trademark intends to associate its trademark with the well-known trademark.

THE BIGGER PICTURE: In its first joint meeting of chief judges in November 2015, the Supreme Administrative Court decided that the term “well-known trademarks” in article 30(1)(11) should be interpreted as referring to trademarks that are recognized by general consumers. The Grand Chamber of the Supreme Administrative Court’s recent ruling changes this opinion. As a result, owners of trademarks that relevant consumers are aware of but that are not yet known to general consumers can now apply article 30(1)(11) of the Trademark Act to reduce the risk of dilution of their marks.

Ruey-Sen Tsai is a partner at Lee and Li, where he focuses his practice on trademarks, patents, copyrights, domain names trade secrets, trade dress and other intellectual property disputes.