CASE 16 : DOLCE&GABBANA TRADEMARK INFRINGEMENT

Trial Docket: (2016) Su 0583 XingChu No. 137

Appellate Docket: (2016) Su 05 XingZhong No. 455

Jiangsu Province

[Headnotes]

The indicative fair use of trademark means that the business entities use other's registered trademark with goodwill and in an appropriate way during the business activity so as to impartially demonstrate the originality and use of their products and the innate features of other products. The indicative fair use of trademark also requires the using of trademark based on integrity and goodwill, the specific forms and degree of the use of the trademark should be kept within appropriate range, and the use of trademark has not damaged the legitimate rights of the trademark owner.

According to Section 1, Article 20 and Article 24 of the Regulation on the Administrative Penalty Procedures of Industry and Commerce Administrative Organs, after the Industry and Commerce Administrative Organs complain, appeal, report and decide to file a case, the personnel handling a case should timely conduct an investigation, collect and acquire evidence, and check in accordance with law and regulation, they can also inquire parties concerned and certifier. Therefore, the inquiring of parties concerned is not the requisite of issuing an administrative penalty.

[Synopsis]

 Plaintiff: Shanghai YiLang International Trade Co. , Ltd., Kunshan Branch (YiLang Company)

 Defendant: Administration for Market Regulation of Kunshan City, Kunshan Municipal People's Government

The YiLang Company is selling leather handbags, clothes, shoes and baldrics with various kinds of trademarks in its business site in "Kunshan First Outlets". In many places of its shop door and inside the shop, the YiLang Company purposely uses the trademarks such as "LOEWE", "BALL" and "DOLCE&GABBANA". From October to December, 2015, LuoWei Co., Ltd. (Spain), Bally Co., Ltd. and DuoXiJia Trademark Co., Ltd. respectively appealled to Administration for Market Regulation of Kunshan City on the illegal use of the above trademarks. On November 3, 2015, Administration for Market Regulation of Kunshan City filed a case for the appeal, and on March 15, 2016, it released the Notice of Correcting Misconducts (No. [2016] G/Z/S0801002) requiring the YiLang Company immediately stop its infringement behaviors of using registered trademark of "LOEWE", "BALLY" and "DOLCE&GABBANA" in its shop door and inside the shop. YiLang Company requested an administrative review of Kunshan Municipal People's Government on May 20, 2016, Kunshan Municipal People's Government released the Decision on the Administrative Review (No. 40) on June 14, 2016, maintaining the Notice of Correcting Misconducts. The YiLang Company file a lawsuit to the court and pledges the court to, first, revoke the Notice of Correcting Misconducts (No.[2016]G/Z/S0801002) released by Administration for Market Regulation of Kunshan City, and second revoke the Decision on the Administrative Review released by Kunshan Municipal People's Government.

Without the permission from trademark register, the YiLang Company behavior that purposely uses the trademarks such as "LOEWE", "BALLY" and "DOLCE&GABBANA" in the shop door and inside the shop, is defined as the use of trademark above, this use of trademark will misguide the public on the identity of the retailer, misunderstand t h a t Y i L a n g Company i s a n authorized retailer or there are other relevant relations between YiLang Company and trademark holder, and further inappropriately used the business reputation the trademark accumulated which excessed the appropriate range of using the trademark, damaging other's inclusive rights on registered trademark, and this is defined as infringement behaviors of exclusive rights of trademark. The Notice of Correcting Misconducts (No.[2016]G/Z/S0801002) released by Administration for Market Regulation of Kunshan City clearly tells the truth, and the administrative penalty procedure of Administration for Market Regulation of Kunshan City as well as the procedure of Decision on the Administrative Review released by Kunshan Municipal People's Government both are in accordance with the law. Therefore, the court rejects the pledge proposed by the YiLang Company, YiLang Company then made an appeal, the second instance court maintained the judgement.

[Judge's Comment]

This case fully demonstrates the function of judicial review of administrative trial on intellectual property and administrative law enforcement, it conducts an overall review on the legitimacy of administrative enforcement on the facts and law level, the case also attaches importance to combining the judicature of intellectual property and administrative protection, clarifies the lawful boundary to the difficult questions on registered trademark infringement in the import and export, and regulates the behaviors of the business entities' overuse of indicative fair use of trademark as well as the infringement of making use of other's business reputation.

CASE 17 : TAITAILE ADMINISTRATIVE PENALTY DISPUTE

Trial Docket: (2016) Zhe 0106 XingChu No. 86

Appellate Docket: (2017) Zhe 01 XingZhong No. 1

Zhejiang Province

[Headnotes]

When one registered trademark's component is identical with or similar to another's registered trademark, to be used on or in connection with the same or similar goods or services, it must comprehensively take into consideration of manner of use, business custom, necessity of use, and reputation of the offended mark, to determine whether use of such component alone would be reasonable. If the reasonableness is eliminated, trademark infringement shall be determined.

[Synopsis]

Plaintiff: Zhejiang Shaoxing Jiuxianghong Vineyard Co., Ltd.

Defendant: Zhejiang Shaoxing Administration for Market Supervision & Management and Zhejiang Administration for Industry & Commerce

Third Parties: Shaoxing Taitaile Food Ltd. and Nestle S.A.

On October 21, 2015, defendant Shaoxing Administration for Market Supervision & Management (the Administration) issued a citation, ShaoShiJianPaoZi (2015) No. 56, for administrative penalty against plaintiff, holding: plaintiff's use of a trademark in connection with cooking wine series product is identical with the distinctive word portion of the marks and registered for food flavorings in class 30; cooking wine, monosodium glutamate, chicken essence, and other food flavorings are all listed in the same category of national standard – food flavorings (GBT20903-2007); meanwhile, the Taitaile series cooking wines and the food flavorings of chicken essence of the third party Nestle are closely connected in terms of function, use, distribution channels, and consuming public, and are therefore similar goods. Nestle's registered trademark "太太乐" for "chicken essence (food flavorings) was recognized in April, 2009 as a well known mark by the Trademark Office, enjoying considerable reputation among the public. Plaintiff Jiuxianghong's use of the trademark  in connection with the similar goods of cooking wines without permission from Nestle is an act of trademark infringement of the exclusive rights, as prescribed under the Trademark Law of People's Republic of China, Article 57(2), "Using a trademark that is similar to a registered trademark in connection with the same goods, or that is identical with or similar to a registered trademark in connection with the same or similar goods, without the authorization of the owner of the registered trademark, which may cause public confusion." Plaintiff's sale of the packaging material for the 太太乐cooking wine series products is an infringing act as prescribed under Trademark Law, Article 57(3), "Selling goods that violate the exclusive right to use a registered trademark." In accordance with Trademark Law provisions under Article 60(2), "Upon determining that trademark infringement has taken place, the administrative authority for industry and commerce shall order the infringer to cease its infringing activity immediately, confiscate and destroy the infringing goods, and any instruments mainly used to manufacture the infringing goods and counterfeit registered trademark. If the amount of illegal earnings is greater than RMB 50,000, a fine up to 5 times the amount of the illicit earnings may be imposed; if there is no illicit business revenue, or the total amount of illicit business revenue is less than RMB 50,000, a fine up to RMB 250,000 may be imposed …," the Administration decided to order an immediate cease the infringing activity, and decided to impose a fine of 90 thousand yuan against plaintiff Jiuxianghong.

Plaintiff Jiuxianghong was not satisfied with the above penalty, and petitioned with Zhejiang Administration for Industry & Commerce for reconsideration on December 17, 2015. Defendant Zhejiang Administration on March 14, 2016 made an Administrative Decision on Reconsideration, ZheGongShangFu [2015] No. 42, to affirm.

The third party Taitaile Company is the registrant of Reg. No. 3198511 for "太太乐and Design" designating goods (class 33), mint julep, aperitif, wine, yellow rice wine, alcoholic liquid, fruit wine (alcoholic), spirit, rice wine, cooking wine, alcoholic beverage (except beer), with expiration date of June 20, 2023. On January 1, 2014, Taitaile issued a Letter of Authorization to plaintiff Jiuxianghong to manufacture the 太太乐series cooking wine, effective from January 1, 2014 through December 30, 2015.

Trademark Reg. No. 1506180 for is owned by the third party Nestle, designating goods in class 30 for good ingredients (food flavorings), food flavorings, soy sauce, vinegar, monosodium glutamate, pepper powder, garlic sauce, instant noodle, rice, flour, with expiration date of January 13, 2021.

Trademark Reg. No. 843154 for is owned by the third party Nestle, designating goods in class 30 for food flavorings such as mustard, monosodium glutamate, sauce, paste, etc., with expiration of date of May 27, 2016.

The third party Taitaile Company filed a trademark application for on November 8, 2010 in class 33. The State Administration for Industry & Commerce, the Trademark Review & Adjudication Board in review of opposition found the mark to be sufficiently close to and registered trademarks, and refused registration.

Plaintiff Jiuxianghon contended that its use of the 太太乐marking on cooking wines is derived from the distinctive portion of trademark Reg.No. 3198511 for "太太乐and Design." Its use did not alter the trademark's distinctive portion, and should be considered use of Reg. No. 3198511 for "太太乐and Design." Plaintiff Jiuxianghong was asked by third party Taitaile to manufacture the cooking wine product, which was sold entirely to Taitaile, for which the only gain was the processing cost. For this reason, plaintiff Jiuxianghong was not the actual manufacturer or seller, and its use was not trademark use. Therefore it requested withdrawal of the penalty, and the Reconsideration Decision. The court decided, according to Articles 69 and 79 of the Administrative Procedure Law of People's Republic of China, to dismiss the complaint of plaintiff Jiuxianghong.

[Judge's Comment]

This administrative case of intellectual property dispute is conducted in a "three-in-one" mode by the intellectual property division of the court. Worth noting in this case is, one, whether plaintiff Jiuxianghong's use a portion of a registered trademark on its product is justified, which involved an issue of boundary of the registered trademark's right, and trademark fair use. Two, in a product processing relationship, how should liability of infringement be allocated between the entrustor and the entrustee. Plaintiff considered the marking is derived from the word portion of (太太乐and Design), a fair use, and its manufacture of the infringing product was under entrustment from third party Taitaile, does not render it a manufacturer and seller in trademark sense. The legal issue in this dispute is a typical one. For plaintiff's contention of fair use, it must be concluded from the perspective of trademark use, in conjunction with business custom, the necessity of use, and the third party's reputation, that the use of cannot be justified.

CRIMINAL CASE

CASE 18: HEWLETT-PACKARD COUNTERFEIT REGISTRATED TRADEMARK

Trial Docket: (2017) Jing 0108 XingChu No. 406

City of Beijing

[Headnotes]

Article 213 of the Criminal Code provides that the crime of trademark counterfeit refers to an act in violation of the national trademark law and regulations, without permission from a trademark registrant, for using a mark identical with the registered trademark, with aggravating circumstances.

[Synopsis]

Plaintiff: People's Prosecutorial Court of Haidian District, Beijing

Defendant: YE Yina

Defendant YE Yina, since 2014, conspired with WANG Kedi (charged in separate case) to make and sell Hewlett- Packard (HP) toner cartridges. On July 25, 2016, defendant Ye was arrested by Beijing police, who uncovered 50 HP toner cartridges, a toner refilling device, and other stuff in her business location at Kemao Plaza, Suite 4A027, Haidian, Beijing. Police also found in the warehouse No. 1123C in the building 195 HP toner cartridges, and HP tamper-proof labels, bubble bags, and packaging boxes, etc. Subsequently, police discovered 131 more HP toner cartridges and toner from a renting place in Shuangta Village in Haidian, and 272 HP toner cartridges and HP packaging boxes from the village warehouse. These are all found to be fakes of registered HP trademarks, estimated to be worth of 624,961 yuan.

The court found: defendant YE Yina, without permission from trademark registrant, used an identical mark on the same goods, with aggravating circumstances, thus constituting the crime of trademark counterfeit, deserving punishment. The accusation of trademark counterfeit brought by the People's Prosecutorial Court of Haidian, Beijing against defendant Ye was based on clear facts with ample evidence, and Ye was indicted. Defendant's counsel raised the point that the seized cartridges filled with toner might be sold under the mark JINGHUI. Ye's statement to police and a witness Lü Bei testimony indicated that the HP label was pasted over with JINGHUI before refilling, and when the JINGHUI labels were applied some cartridges would be left unpasted without JINGHUI labels, and went directly with second refilling. Therefore, changing the HP labels were done prior to refilling. Based on the cartridges seized, only a small portion had been changed from HP to JINGHUI labels; in most pasted cartridges, HP labels were easily discernible, and the JINGHUI labels were of shabby quality, which would merely be applied over the HP labels, and many wouldn't even cover completely, including those sealed, ready for sale where HP labels could still be seen, which was in line Ye's statement. Such simplistic cut-and-paste was more than sufficient to mislead consumers to the product source as the well known HP brand. Moreover, the on-site seizure also showed cartridges refilled and loaded into the bubble bags or packaging boxes, which appeared basically consistent with other seized cartridges refilled but unpackaged. Taken together with the large number of counterfeit plastic seals or pulling rings, the bubble bags and packaging materials, it is more than enough to supporting a finding of intentional act by Ye for counterfeiting. The pasting by Ye and others was merely an attempt to cover up the counterfeiting, and would not rebut the finding of counterfeiting, nor the determination of the number of counterfeited cartridges seized. The trial court rendered the judgment: one, defendant YE Yina was guilty of trademark counterfeiting, and therefore sentenced to three years in prison, with a fine of 400 thousand yuan. Two, the seized cartridges with counterfeit HP labels, the packaging materials and criminal instrumentalities were by law confiscated.

After announcement of the trial decision, defendant Ye did not appeal.

[Judge's Comment]

This case serves as a powerful support and guidance for suppressing the trademark counterfeit crimes by sales with cut-and-paste trademark labels. Currently, many counterfeiters, in order evade strikes and liabilities, would no longer sell counterfeit goods blatantly with well known brands; instead, they would use some coverup skills and conduct sales undercover, some by selling the refilled branded cartridges without packaging as original attachment or as test products, or by keeping them unpackaged until delivery, or selling them as discounted after covering the brand. Some of them even have their own brands by which to promote their business. But when consumers contact them, they will hint some connection with the branded products. Some simply cover the original brand and when selling them they will just peel off their own brands, to profit by outright passing off. The present case sets an example in the counterfeiting goods of HP toner cartridges, taking together the feature of printer toner cartridge product and business mode, in accordance with the basics of registered trademark, and the constituent elements of criminal violation of trademark counterfeit, to define toner cartridge processing, and the finished products, i.e., to make an in-depth an analysis and determination of simple cut-and-paste, coverup, and false labeling, giving clearer standard and rules for judicial guidance, and providing sufficient support for detection and prosecution in similar cases.

CASE 19: ZESPRI ILLEGALLY MAKING TRADEMARK LABELS

Trial Docket: (2017) Hu 0115 XingChu No. 3300-3303, 3326-3327

City of Shanghai

[Headnotes]

Determination of "basically identical mark," which is substantially undifferentiable from a registered trademark by visual observance, and likely to mislead the public, should be made by general observation, overall observation, detailed observation, and separate observation. Minute visual differences undetectable by public under ordinary circumstances would be sufficient. Attention must be paid to distinction from "similar marks" in civil cases, by observing alteration of the distinctive features of the registered trademark, any difference in visual effect, and whether such effect would be sufficient to affect public recognition.

[Synopsis]

Plaintiff: Dole Food Company of the United States, Zespri Group Limited of New Zealand and Sunkist Growers, Inc. U.S.A

Defendant: Chen and other 12 people

and SWEETIO are the trademarks registered in China by Dole Food Company of the United States; and are the trademark registered in China by Zespri Group Limited of New Zealand; and (designating color) is the trademark registered in China by Sunkist Growers, Inc. U.S.A. All the above trademark registrations are in their effective terms and are under the protection of Chinese laws. The 13 defendants, Chen and others, knowing purchased false labels in large amount, and then sold in their stores. On May 25, 2017, police arrested the 13 defendants of Chen and other in their stores, seizing 1.1 million labels of Upon verification of organizations authorized by trademark registrants, all these labels at issue are counterfeit labels. All defendant confessed to the above facts.

The Pudong Court found there were 14 illegally made trademark labels, of which 11 showed no overall visual disparity when compared to the registered ones. Although some of the labels were different from the registered marks by adding addresses, changing the words or word order, or adding barcodes, these changes are hardly noticeable, and are not substantial changes to the registered mark, and do not affect the marks' distinctive features. Therefore these 11 marks constitute identical marks in criminal law sense. Whereas, the label , compared to the registered mark , should not be considered as identical mark in criminal law sense because although the upper portions are basically the same, the lower part is changed significantly, with the English and numeral changed to Chinese "红心" for which the wording styles and pronunciations are all different, with obvious visual difference from the registered mark. The marks and comprise letter, numerals and designs, and when compared to the registered mark (designating color), the orientation of the mark is changed, the word "Sunkist" is located to the upper portion with smaller fonts, the vertical stripes and the word JINGPIN in a white background take up much of the label.

The composing elements, the overall structures, the conspicuous visual disparities of both the accused mark and the registered mark do not show trademark identicalness in criminal law sense. Therefore the marks ,,ought be deducted from the criminal gains. The court eventually found the 13 defendants Chen and others guilty of selling illegally made labels of registered trademarks, and sentenced them to various terms including detention from two years and eight months to five months, probation of five months, and fines. After the sentencing, none of the defendants appealed. Neither did the prosecution. The judgment became effective.

[Judge's Comment]

This is one of the criminal cases involving over 10 trademarks, 1.1 million labels, for well known imported fruits consolidated at the people's court of Pudong New District, relating to Zespri, Dole, Sunkist, and other well known marks. These cases followed strict standards, accurately measured "identical trademarks" denoting that the "identical trademark" in criminal law sense means completely identical or substantially undifferentiable in visual from the registered trademark sufficient to cause mistake among the public. Determination of "identical mark" should be made by general observation, overall observation, detailed observation, and separate observation. Minute visual differences undetectable by public under ordinary circumstances would be sufficient. Attention must be paid to distinction from civil standard of "similar marks" by observing alteration of the distinctive features of the registered trademark, any difference in visual effect, and whether such effect would be sufficient to affect public recognition.

If the accused mark merely changes the color, word order, by adding places names or barcodes which are insignificantly noticeable indicia, without affecting the distinctive feature of the registered mark to influence public recognition, it should be taken as "identical mark" in criminal law sense. If, however, the composition element or the overall structure of the accused mark is insufficiently identical, with visual disparities, no criminal finding should be made for "identical mark" even if the mark contains the major portion of a registered mark. These cases represented the strength for judicial protection of intellectual properties and suppression of counterfeiting goods, to the benefit of construction of lawful business environment.

CASE 20 : AMWAY COUNTERFEIT REGISTERED TRADEMARK

Trial Docket: (2017) Zhe 1002 XingChu No. 123

Appellate Docket: (2017) Zhe 10 XingZhong No. 621

Zhejiang Province

[Headnotes]

According to Section 2, Article 67 of Trademark Law of the People's Republic of China, where an act of counterfeiting or producing, without authorization, labels of another's registered trademark, or selling of trademark labels that were counterfeited or produced without authorization has constituted a criminal offense, the infringer shall, in addition to compensating the infringed party for losses incurred, be subject to criminal liability in accordance with the law. According to Section 3, Article 67 of Trademark Law of the People's Republic of China, where an act of knowingly selling goods bearing a counterfeited registered trademark has constituted a criminal offense, the infringer shall, in addition to compensating the infringed party for losses incurred, be subject to criminal liability in accordance with the law.

[Synopsis]

Public Prosecutor : People's Procuratorate of Jiaojiang District, Taizhou City

Defendant: Zheng Xiangchuang and other 12 people

During the period from 2014 to June 2016, the defendants, Zheng Xiangchuang and Zheng Haosheng (handled as a separate case), without permission of the owner of registered trademark, produced series domestic articles and cosmetics under the brand of Amway, and sold such goods to the defendants, Zhang Chuanyou and Li Huixia (handled as a separate case), etc., gaining illegal revenue of up to RMB 1.79 million.

During the period from July 2015 to May 2016, Zhang Chuanyou, one of the defendants, established the warehousing point of sale and sold counterfeit "Amway" series domestic articles and cosmetics purchased from Zheng Xiangchuang, also one of the defendants, gaining the revenue of over RMB 1.3 million, including the revenue of RMB 229,467 from the defendants including Zhang Li and Li Haiyan, etc., resulting in illegal income of RMB 200,000. The public security authority additionally seized counterfeit "Amway" series domestic articles and cosmetics worth over RMB 390,000.

During the period from May 2015 to April 2016, the defendant Duan Junling, without authorization of the owner of registered trademark, purchased raw materials of cosmetics and packing boxes, produced cosmetics of "LANCOME", "CHANEL" and "ESTEE LAUDER" brands with empty bottles for cosmetics printed with "LANCOME" provided by the defendant Liu Youfu and empty bottles necessary for producing other counterfeit cosmetics, and sold counterfeit cosmetics worth about RMB 200,000 to one of the defendant in the same case Zhang Li. The defendant Duan Guangwei furnished the bank card to the defendant Duan Junling for use, and under the instigation of the defendant Duan Junling, delivered and sold counterfeit cosmetics to him and collected partial payment on such goods. The public security authority seized counterfeit cosmetics with sales of over RMB 160,000 from the homes of the defendants Duan Junling and Duan Guangwei.

During the period from 2015 to April 2016, the defendant Zhang Li purchased counterfeit Amway series domestic articles and cosmetics from the defendant in the same case, Zhang Chuanyou, and purchased counterfeit series cosmetics of "LANCOME", "CHANEL" and "ESTEE LAUDER" brands from the defendant Duan Junling; the defendants Zhang Li and Li Haiyan established the point of sale and gained sales revenue of over RMB 60,000 from the defendants in the same case Li Hailong, Li Wei and Duan Yuecui. The public security authority also seized cosmetics and domestic articles of counterfeit "Amway", "LANCOME", "CHANEL" and "ESTEE LAUDER" brands with sales of over RMB 100,000.

During the period from 2014 to March 2016, the defendant Li Hailong, through an online store at Taobao.com operated by him, sold counterfeit "Amway" series domestic articles and cosmetics, gaining revenue of over RMB 170,000, including revenue of over RMB 10,000 from the defendants including Li Wei and others. The public security authority also seized counterfeit "Amway" cosmetics and domestic articles with sales of over RMB 500.

During the period from July or August 2015 to December 2015, the defendants Li Wei and Li Xiancheng, ganging each other, purchased counterfeit "Amway" series domestic articles and cosmetics from the defendants including Li Hai Long and Zhang Li, etc. and sold such domestic articles and cosmetic, gaining the revenue of over RMB 200,000. In the middle and last ten days of December 2015, the defendants Ke Botao, Ke Yunjian and Wang Haibing joined the gang. Until the middle and ten days of February 2016, the defendants Li Wei, Li Xiancheng, Ke Botao, Ke Yunjian and Wang Haibing jointly sold counterfeit "Amway" series domestic articles and cosmetics, gaining the revenue of at least RMB 100,000. Later, one of the defendants Wang Haibing withdrew from the gang and got the illegal income of RMB 13,000. By March 15, 2016, the defendants Li Wei, Li Xiancheng, Ke Botao and Ke Yunjian got the illegal income of RMB 14,500 respectively. The public security authority additionally seized in the warehouse leased by the defendants including Li Wei various types of counterfeit "Amway" series domestic articles and cosmetics that remained unsold and were worth over RMB 119,000.

In the opinion of the People's Procuratorate of Jiaojiang District, Taizhou C i ty, the a c t of the defendants ZhengXiangchuang, Duan Junling, Duan Guangwei and Liu Youfu have constituted the crime of counterfeiting the registered trademarks, and the act of the defendants Zhang Chunayou, Zhang Li, Li Haiyan, Li Hailong, Li Wei, Li Xiancheng, Ke Botao, Ke Yunjian and Wang Haibing have constituted the crime of selling commodities carrying counterfeit registered trademarks. So, the people's procuratorate instituted a prosecution to the court, requesting the court to punish by law.

Through trial, the People's Court of Jiaojiang District, Taizhou City, entered the judgment on April 27, 2017 based on the above facts: the defendants including Zheng Xiangchuang were convicted of the crime of counterfeiting registered trademarks or selling commodities carrying counterfeit registered trademarks and sentenced to fixedterm imprisonment of one year to four years and fined ranging between RMB 20,000 and RMB 900,000; with illegal income recovered. The tools for criminal purpose detained during the investigation were confiscated by the detaining authority Taizhou Public Security Bureau Jiaojiang Branch; the booties as detained were confiscated and destroyed by the detaining authority Taizhou Public Security Bureau Jiaojiang Branch. One of the defendants, Wang Haibing, was forbidden to get engaged in the operation of any online store at Taobao during the probation period for suspension.

After the judgment, the People's Procuratorate of Jiaojiang District, Taizhou City lodged a protest against the judgment for the reasons of wrong applicable laws and inappropriate measurement of penalty due to wrong finding of facts. The defendants in the first instance, Zheng Xiangchuang, Zhang Chuanyou, Duan Guangwei, Liu Youfu, Li Hailong, Li Wei, Li Xiancheng, Ke Botao and Ke Yunjian filed an appeal against the judgment.

Taizhou Intermediate People's Court judged on August 31, 2017 that it permit the appellants (the defendants in the first instance) Zhang Chuanyou and Duan Guangwei to withdraw the appeal; reject the protest and the appeal and sustain the original judgment.

[Judge's Comment]

Since this case involves a lot of persons and covers an extensive geographic region and complex network and the sales channels of counterfeit commodities cover traditional channels and internet platforms, certain difficulties may exist in the determination of crime amount of each defendant. Two courts appropriately apply rules of evidence including distribution of burden of proof and presumption of fact of the case, and in combination with such evidence as defendants' confession, witnesses' testimonials, electronic data regarding internet sales, bank correspondences of the defendants, delivery form, bookkeeping records of the defendants, determine the amounts of illegal operation revenue and il legal income, and realize seamless integration of amount determination among upper and lower levels, thus fighting against violations and crimes effectively and maintaining the impartiality, regulation and author i tativeness of judicial judgment.