Keywords: Copyright infringement; unfair competition

Counseling Attorney: Qiu Hui, Liu Yang

Basic Facts of the Case:

1. Plaintiff’s claim

Plaintiff Jing obtained, in succession, a “Certificate of Copyright Registration” and a “Patent Certificate for Design Patent” from the National Copyright Administration, both pertaining to an illustrative rendering and packaging bag for a red bean and glutinous rice square cake. Plaintiff Jing has used the aforementioned works and patents on the outer packaging of products manufactured by Shenyang [Company Name] Food Co., Ltd. (hereinafter referred to as “[Company Name]”), which it operates. The “[Company Name]” trademark of [Company Name] has been recognized as a well-known trademark in both Liaoning Province and Shenyang City. In June 2022, the plaintiff discovered that the outer packaging of the “Qiu’s Red Bean and Glutinous Rice Flavor Ice Cream,” produced and sold by Xuedi Food Technology Co., Ltd. (hereinafter referred to as “Xuedi Company”), was substantially identical to the packaging covered by the plaintiff’s copyright and patent rights. This similarity has caused consumer confusion and misrepresentation, resulting in a significant decline in sales of [Company Name]’s red bean and glutinous rice square cake products in the Hunan region. Plaintiff Jing now requests the court to order defendant Xuedi Company to immediately cease its infringing acts of producing and selling products that violate the plaintiff’s copyright, compensate the plaintiff for its losses and reasonable expenses incurred in protecting its rights, and issue a public apology.

2. Point of contention:

Did the defendant engage in conduct that infringed upon the plaintiff’s copyright, and does this constitute unfair competition?

3. Attorney’s Opinion:

(1) The defendant acted with subjective intent to infringe. The intended use of the plaintiff’s artwork renderings is identical to that of the infringing product renderings produced by Xuedi Company; the two are同类 products. The plaintiff licensed its copyright and exclusive rights for use on the outer packaging of a certain company’s products, and those products had already been sold in the region where the defendant, Xuedi Company, operates. As a competitor in the same industry, Xuedi Company had ample opportunity to come into contact with the copyrighted works at issue. Moreover, after receiving a lawyer’s letter from the plaintiff demanding that it cease the infringement, Xuedi Company proceeded to revise the infringing product renderings, which clearly demonstrates Xuedi Company’s subjective intent to infringe.

(2) The renderings are substantially similar. The front-view rendering of a product is the part that generally attracts the most attention from consumers and carries the greatest weight in influencing the overall visual effect of a product. The shape of the front-view rendering of the plaintiff’s work and that of the defendant’s infringing product are both three-dimensional images tilted upward and to the right at a 45° angle; the designs of these two shapes are identical. The front side, when viewed in cross-section, exhibits identical layout, color combinations, and overall appearance. From a typographical perspective, the two designs employ exactly the same materials, colors, and structural arrangements, making them identical. The only minor difference lies in the wafer shell itself. Therefore, the renderings of the plaintiff’s work and those of the defendant’s infringing product constitute substantial similarity in a legal sense.

(3) The plaintiff has suffered substantial losses. The red bean glutinous rice square cake product is an original, flagship product of the plaintiff’s company, Company X, and has been sold nationwide since 2009. It enjoys high industry recognition and strong consumer approval. The defendant deliberately infringed upon the plaintiff’s copyright by using visual representations that are substantially similar to the plaintiff’s work as the primary images on its infringing products and selling these products for profit, thereby confusing and misleading consumers. This conduct has severely harmed the plaintiff’s copyright as well as the legitimate rights and interests of the plaintiff’s company.

4. Judgment outcome:

In this case, the first-instance judgment dismissed the plaintiff’s claim, but the second-instance court reversed the decision and ruled in favor of the plaintiff. The retrial upheld the second-instance judgment, and the plaintiff ultimately won the case.

Case Highlights:

Through the lawyer’s representation, the second-instance court corrected the first-instance court’s erroneous conclusion that the works in question did not constitute substantial similarity. The court carefully and thoroughly examined the nature of the rights-holding work and conducted a comprehensive comparison, ultimately finding that the main view of the rights-holding work was substantially similar to that of the infringing product. After a thorough evaluation of the entire case, the final judgment ordered the defendant to cease the infringement, destroy the infringing packaging bags as well as the computer data used to produce such packaging bags, and compensate the plaintiff for its losses.

In the first-instance court’s determination that the plaintiff’s work was not substantially similar to the main view of the infringing product, the second-instance court conducted a meticulous comparison of the main view, sectional views, and renderings, examining such elements as material, color, and compositional structure, and concluded that the two works were indeed substantially similar. The second-instance court also made a detailed determination regarding the nature of the plaintiff’s copyrighted work: the plaintiff’s work was registered as a “fine art work.” The second-instance court held that when deciding whether an object qualifies as a graphic work or a fine art work, the key criterion should be whether the object possesses artistic qualities imbued with aesthetic significance, and the relevant field to which the expressive subject belongs should serve as the standard for judgment. As for the purpose of creation, the plaintiff’s work was designed specifically for the production of square-shaped ice cream cakes of the same type. In terms of the pattern’s function, the design primarily illustrates the structure of the square ice cream cake, which consists of an outer wafer layer and three distinct fillings inside—thus clearly demonstrating the cake’s internal construction. Furthermore, in terms of the pattern’s actual use, Company某某 has indeed produced corresponding ice cream products based on this very pattern. Therefore, the plaintiff’s work should be recognized as a graphic work.

The defendant argued that the packaging bag patent held by the plaintiff had lapsed and entered the public domain, thereby claiming that its actions did not constitute infringement. The second-instance court held that the Patent Law and the Copyright Law are two independent laws of equal force. The court found that the plaintiff’s claim to protect its rights under the Copyright Law was lawful and well-founded, and accordingly dismissed the defendant’s aforementioned argument.

Typical significance:

1. The second-instance court clarified whether it constitutes... The essential elements for defining a work under copyright law are: possessing originality, being an original creation in the fields of literature, art, and science, capable of being expressed in a certain form, and constituting an intellectual achievement.

2. The nature of the work in question has been clarified as a graphic work. When determining whether a particular object qualifies as a graphic work or a fine art work, the registration details should not be the determining factor. Instead, the assessment should be based on whether the object possesses artistic qualities with aesthetic significance, using the field to which the expressive subject belongs as the relevant criterion.

3. It is clear that copyright and patent rights pertain to different fields and are protected under different laws. After the term of protection for a design patent—including the image in question—expires, that image can be protected under copyright law. The Patent Law and the Copyright Law are two independent statutes of equal force. The protection afforded by design patents and copyrights is governed by these two distinct laws respectively and does not inherently conflict with each other.

Lawyer's Insights ：

When handling copyright infringement cases, it is essential to assess the nature of the work from multiple perspectives rather than relying solely on the registration status of the work. To determine whether infringement has occurred, focus on the criteria of similarity and access—carefully compare the rights-protected work with the allegedly infringing work—and then make a preliminary judgment as to whether the two works are identical or substantially similar. Collect evidence diligently and with professionalism and seriousness, paying close attention to every case, every procedural step, and every detail. Even if litigation does not proceed smoothly, maintain a dedicated and professional attitude, persistently striving to turn the tide and minimize losses for your client while promptly containing further harm.