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New Balance Wins $3.9M Trademark Case. Is China Cracking Down on Copycats?

A pair of twin January trademark infringement cases could signal an increasing willingness from Chinese courts to take on copycats.

Early last month, Hanesbrands won a $600,000 case against six defendants who it accused of producing and distributing counterfeit Champion products and operating unauthorized Champion retail outlets. The Nanjing Intermediate People’s Court ruled in the North Carolinian company’s favor and ordered the defendants to immediately cease all infringement of the Champion brand.

This week, The Financial Times reported on an even larger January decision, this one involving New Balance. Early last month, the Shanghai Huangpu District Court awarded the Boston-based footwear giant 25 million yuan ($3.87 million) in damages, ruling that Fujian-based shoe maker New Barlun and its distributor Shanghai Shiyi Trade Co. infringed on New Balance’s capital “N” trademark. The compensation amount is subject to appeal.

According to The Fashion Law, the court found New Barlun’s copycat sneakers generated substantial revenue and that its success was largely attributed to the reputation of the New Balance brand and its trademark. The court also noted the defendants acted in bad faith when they continued to operate after it had issued an interim injunction forbidding them from manufacturing and selling the lookalike footwear for the duration of the case.

“The New Barlun victory represents years of hard work in the fight against parasite and counterfeit brands,” Dan McKinnon, New Balance’s senior counsel, IP & global brand protection, said. “The win is encouraging on two fronts; the increased level of damages should help act as a further deterrent to future bad actors, and also serves as a notice of the increased power of our “N” trademark in China and beyond.”

This isn’t the first time New Balance has taken New Barlun to court and won. Last year, the Pudong New Area People’s Court in Shanghai declared the Chinese brand had engaged in “unfair competition” and awarded New Balance $1.5 million, Highsnobiety reported at the time.

In 2017, another Chinese court ruled that three other domestic shoemakers— Zheng Chaozhong, Xin Ping Heng Sporting Goods Limited Company and Bo Si Da Ke Trading Limited—had infringed on New Balance’s signature “N.” The footwear brand won $1.5 million.