First-instance case number: (2019) Hu 03 Xing Chu No.55

Second instance case number:(2019) Hu Xing Zhong No.106

Suppose many people participate in the crime of counterfeiting registered trademarks and selling counterfeit registered trademark goods. In that case, they should accurately identify each defendant’s criminal nature and the amount of participating in the joint crime according to the joint crime theory and relevant laws and regulations. Then scientifically distinguish between the principal and the accessory, sentence the defendant to personal freedom within the statutory penalty range, and impose a fine according to the illegal business amount of 50% to 1 time.

Case introduction

Former Public Prosecution Organ: Third Branch of Shanghai People's Procuratorate

The victim in the original trial: L'OREAL SOCIETE ANONYME

Appellants (defendants in the original trial): Xu Zhenwei and Lu Chengxue

Defendants in the original trial: Huang Jiecheng, Wang Bin, Zhong Hongbiao, Zhang Tianzhu, Qin Meihua, Zhang Guibao, Xie Hui and Ning Jiangfei

France Laiya Company and Japan DR.CL ：LABO have registered the trademarks "KIEHL'S", "Kiehl's" and "LaboLabo" respectively in cosmetics and other commodities in China. During the period from 2015 to the incident, Xu Zhenwei made an illegal profit. Without obtaining the trademark owner’s permission, he entrusted Huang Jiezhen to develop and produce the formula and raw materials of fake "KIEHL'S" and "Labolabo" cosmetics. Furthermore, he entrusted Lu Chengxue or Zhong Hongjun to entrust Ning Jiangfei to print fake "KIEHL’S" stickers and thermal transfer trademarks and entrusted others to provide cosmetics bottles. And successively hired Zhang Tianzhu, Qin Meihua, Zhang Guibao and Xie Hui to fill, label, box, pack, receive and deliver fake cosmetics of "KIEHL’S" and "Labo Labo" in the production dens. Xu Zhenwei sold cosmetics of "KIEHL’S" and "Labo Labo" brands to Wang Bin and others for retail. Defendants Xu Zhenwei, Huang Jiecheng, Zhang Tianzhu, Zhang Guibao, Qin Meihua and Xie Hui all produced and sold counterfeit registered trademark goods with a total amount of 4.63 million yuan. Defendants Lu Chengxue participated in counterfeiting registered trademark goods with a total amount of 4.15 million yuan, Wang Bin illegally sold counterfeit registered trademark goods with a total amount of 4.1 million yuan, and defendants Zhong Hongbiao and Ning Jiangfei participated in counterfeiting registered trademark with a total amount of 450,000 yuan.

The court of first instance held that nine defendants, including Xu Zhenwei, used the same trademark as the registered trademark on the same commodity without the registered trademark owner’s permission and sold them. The circumstances were particularly severe, and their actions all constituted the crime of counterfeiting the registered trademark. In the joint crime, the defendants Xu Zhenwei and Huang Jiecheng are the principal offenders and should be punished according to all the crimes organized and directed by them. Defendants Lu Chengxue, Zhang Tianzhu, Zhang Guibao, Qin Meihua, Xie Hui, Zhong Hongbiao and Ning Jiangfei participated in the joint crime, all of which were accomplices. The punishment was mitigated according to the amount of the crime they participated in. Defendant Wang Bin sold goods that he knew were counterfeit registered trademarks, and the sales amount was huge, which constituted the crime of selling goods with counterfeit registered trademarks.

The court of first instance sentenced the defendant Xu Zhenwei to four years and six months in prison and fined 2.2 million yuan for counterfeiting registered trademarks, sentenced the defendant Huang Jiecheng to three years in prison and fined 330,000 yuan, and sentenced the defendant Lu Chengxue to one year and ten months in prison and fined 80,000 yuan. The defendants Zhang Tianzhu, Zhang Guibao, Yan Meihua, Xie Hui and Zhong Hongbiao were sentenced to one year and four months in prison. The defendant Wang Bin was sentenced to four years in prison and fined 2.1 million yuan for the crime of selling counterfeit registered trademarks; Seized infringing products and trademarks, counterfeit tools and communication tools used for crimes shall be confiscated, and the illegal income of each defendant shall be recovered.

After the first-instance judgment, the defendants Xu Zhenwei and Lu Chengxue thought that the first-instance sentence was too heavy and appealed. The court of second instance held that the original judgment found that the defendants Xu Zhenwei and Lu Chengxue committed the crime of counterfeiting registered trademarks, and the defendant Wang Bin committed the crime of selling counterfeit registered trademarks. The facts are clear, the evidence is true and sufficient, the applicable law is correct, the sentencing is appropriate, and the trial procedure is legal. Therefore, the ruling rejected the appeal and upheld the original judgment.

Typical meaning

The trademarks "KIEHL'S", "Kiehl's" and "LaboLabo" are registered trademarks of the world-famous cosmetics companies, France Leya Company and Japan Co., Ltd., respectively. Defendant Xu Zhenwei and others committed a "one-stop" criminal act of counterfeiting registered trademarks and selling counterfeit registered trademark goods. The amount of crime was huge, and the social impact was bad. According to the joint crime theory and relevant laws and regulations, the court accurately determined the amount of each defendant's participation in the joint crime, combined with their position and role in the joint crime, distinguished between the principal and the accessory, sentenced him to personal freedom within the statutory penalty range, and sentenced him to a fine of 50% to twice the illegal business amount. The conviction was accurate, and the sentencing was appropriate, which strictly and equally protected the legitimate rights and interests of foreign trademark owners.

In this case, the determination of nature and the amount of crimes committed by each defendant, the scientific distinction between the principal and the accessory and strict application of the fine penalty is of demonstration and reference significance for such cases’ trial. After the verdict was pronounced in the second instance, the French Embassy in China expressed its gratitude to the Shanghai Higher People's Court in a diplomatic note, arguing that the judgment of the case was helpful to improve the confidence of foreign enterprises in the business environment in China. L 'Oreal (China) Co., Ltd., the victim unit, wrote a thank-you letter, saying that the judgment of this case shows the determination of Chinese judicial organs to severely punish intellectual property crimes, strengthen intellectual property protection, safeguard the interests of enterprises and consumers, and optimize the business market.