Recently, the People's Court of Yuhang District, Hangzhou, Zhejiang, rendered a first-instance judgment in the case of YAYING Company v. Mr. Cao and Zhejiang Taobao Network Company. This judgment not only fully upheld the plaintiff’s infringement claims but also demonstrated advanced judicial approaches to intellectual property protection in the holistic identification of infringing acts, the expansion of the scope of legal protection, and the application of punitive damages. This case carries significant guiding value for regulating e-commerce market order and incentivizing industry innovation. The case was handled by Attorneys Yi WANG and Mingyue XU from NTD IP Attorneys.
I. Multi-Dimensional Judicial Determination of Infringing Acts: Comprehensive Protection from Trademarks to Business Achievements
In this case, the court did not confine its determination of infringing acts to a single dimension but instead constructed a comprehensive protection framework spanning from trademark rights to competitive interests.
First, regarding the determination of trademark infringement, the court conducted a clear logical analysis. As a leading enterprise in the domestic high-end women’s apparel industry with years of deep cultivation, YAYING Company is the registered proprietor of multiple trademarks, including "雅莹"(“YAYIING” in Chinese) and "EP YAYING". From 2017 to 2025, the company was consecutively selected as one of the "Top 100 Chinese Apparel Enterprises" by the China National Garment Association, and its "EP YAYING 雅莹" apparel brand enjoys high market reputation and goodwill.
The defendant, Mr. Cao, as a counterparty in the same industry, should have been aware of the reputation of the above-mentioned trademarks. Nevertheless, he engaged in multiple alleged infringing acts on his Tmall store, including: (1) using the wording "优雅莹雅诗"(“YOUYAYINGYASHI” in Chinese) in the titles of as many as 63 product links; (2) indicating "Brand: EP YAYNIG/雅莹" on certain product pages; and (3) directly using the mark "EP YAYING" on certain garments.
The court held that: "优雅莹雅诗"(“YOUYAYINGYASHI” in Chinese) completely incorporates the core distinctive part of the "雅莹"(“YAYIING” in Chinese) trademark, with "优雅"(“YOUYA” in Chinese, meaning elegant) being merely a descriptive prefix that does not alter the likelihood of confusion with the registered trademark. Meanwhile, the defendant’s use of identical or similar marks to "雅莹" and "EP YAYING" on product detail pages and physical garments was highly likely to cause relevant public confusion as to the source of the goods, thereby constituting trademark infringement under Articles 57(1) and (2) of the Trademark Law of the People's Republic of China.
Second, the breakthrough significance of this case lies in the court’s extension of legal protection to the enterprise’s core business information and innovative management systems, holding that the defendant’s copying of garment designs and style numbers constituted unfair competition. The court determined that: the specific garment designs and style numbers developed by YAYING Company in the course of its business operations constitute its core business information for product categorization, inventory management, sales tracking, and customer service. Such information effectively improves operational efficiency, reduces management costs, enhances customer loyalty, and thereby confers actual competitive advantages upon YAYING Company, and therefore falls under the competitive interests protected by the Anti-Unfair Competition Law.
The defendant, as a competitor in the same industry, extensively copied and imitated 56 garment designs of YAYING Company, and used identical or similar style numbers to drive traffic. Such conduct demonstrated clear bad faith with the intent to free-ride on YAYING Company’s goodwill, seeking to capture YAYING Company’s business opportunities without incurring legitimate costs, thereby creating a substantial substitution for YAYING Company’s products. This conduct violated the principle of good faith and generally accepted business ethics, disrupted fair market competition order, and constituted unfair competition under Article 2 of the Anti-Unfair Competition Law.
II. Precise Application of Punitive Damages: Demonstrating the Judiciary’s Resolve to Punish Malicious Conduct and Protect Innovation through Judicial Discretion
Another major highlight of this case is the court’s application of punitive damages for the defendant’s trademark infringement. Pursuant to Article 1 of the Interpretation of the Supreme People's Court on the Application of Punitive Damages in the Adjudication of Civil Intellectual Property Infringement Cases, the application of punitive damages requires the dual elements of "willful" infringement and "serious circumstances". In this case, the court found that the defendant, as a practitioner in the apparel industry, should have been aware of the reputation of YAYING Company and its trademarks, yet still committed the alleged trademark infringing acts, demonstrating clear subjective willfulness. Moreover, the trademark infringement involved a relatively large number of product links and a substantial sales amount, constituting serious circumstances. Accordingly, the court sustained YAYING Company’s claim for punitive damages.
In determining the amount of damages, the court took into account objective differences between the defendant, an individual, and the plaintiff, a listed company, with respect to business scale, cost structure, profit margin, and other factors. After comprehensively considering the reputation of the involved trademarks, the nature and duration of the infringement, and the degree of the defendant’s subjective fault, the court determined a fair and reasonable calculation basis for damages, applied a one time multiplier for punitive damages, and ultimately ordered the defendant to pay YAYING Company a total of RMB 250,000 in economic losses and reasonable expenses.
III. Case Value and Industry Implications: Providing a Replicable Litigation Strategy Sample for Enterprises in Handling Similar Disputes
In this case, Attorneys Yi WANG and Mingyue XU, drawing on their extensive litigation experience and meticulous case handling skills, comprehensively organized the client’s legal rights and the defendant’s infringing acts. They cogently argued that the competitive interests embodied in garment designs and style numbers should be protected under the Anti-Unfair Competition Law, and fully established that the defendant’s conduct met the criteria for punitive damages. The court ultimately accepted their opinions in full, which not only effectively safeguarded the legitimate rights and interests of YAYING Company but also provided valuable practical guidance for resolving similar disputes in the industry.
By organically integrating the general clause of the Anti-Unfair Competition Law with the characteristics of the apparel industry, this judgment provides a judicial protection model for commercially valuable business achievements that do not meet the originality threshold for copyright protection. It effectively bridges the gap beyond the scope of trademark and copyright protection, and embodying advanced judicial wisdom in intellectual property protection.
Iris WANG
Iris Wang joined NTD in 2008 and started her profession in intellectual property, mainly focusing on the area of trademark, copyright, unfair competition and trade secret. During more than 10 years of her work with NTD, Iris assisted many famous enterprises at home and abroad in dealing with different intellectual property legal affairs including civil and administrative litigation related to trademark, anti-unfair competition, and copyright, intellectual property and commercial contracts review，intellectual property strategy consultation, corporate compliance governance, trademark assignment negotiation, copyright registration，administrative raid action and customs protection. In the process of providing legal services to the clients, Iris has accumulated a wealth of experience, and her good professional knowledge and meticulous services enable her to gain recognition from the clients.
Mingyue XU
Ms. Xu specializes in trademark law, anti-unfair competition matters and copyright law. She has extensive practical experience in civil litigation, administrative litigation, administrative law enforcement, customs intellectual property protection, domain name dispute resolution and commercial contract dispute resolution. Having represented and participated in numerous major, difficult and complex intellectual property cases, she excels at systematically analyzing core case points and delivering effective solutions.
Ms. Xu has long provided legal services for well-known multinational corporations across China, the United States, Europe, and Japan in industries including apparel, bags and suitcases, food and beverage, technology, chemicals, machinery and equipment, education and publishing.
