New Balance has won a $1.5 million case against Chinese athletics company New Barlun. Yes, there is literally another brand out there selling shoes called New Barlun.
Last Thursday, the Pudong New Area People’s Court in Shanghai declared that New Barlun engaged in “unfair competition.” The ruling decided that the “N” logo on New Barlun’s shoes — which may or may not remind you of the familiar 571 silhouette — “could cause customers to be confused” in regards to the source of the sneakers and/or their affiliation with New Balance.
New Balance argued the continued use of the New Barlun logo — which is similar not only in appearance but also its placement on the side of the shoe — was unfair competition, and ultimately had a negative effect upon its reputation and goodwill. New Barlun countered that it had a trademark for its logo — which it (no laughing here) claims is different — and therefore was entitled to use it. Ultimately, the court sided with New Balance, claiming that irrespective of the fact New Barlun’s “N” is a registered trademark, it still violates the basic trademark tenant of “good faith.”
The court went on to declare that the public “would sufficiently associate the products decorated with ‘N’ letters on both sides of the athletic shoes with ‘New Balance,’” thereby entitling the Boston-based company to protection by way of China’s Unfair Competition Law. New Balance first entered the Chinese market in 2003.
As picked up upon by The Fashion Law, trademark law attorney Aaron Wininger surmised the case, writing: “As a competitor in the same industry, New Barlun still uses the similar logo on the same position of the similar goods it produces when it knows that the N letter logo on both sides of the plaintiff’s shoes has a certain influence, which reduces the plaintiff’s goodwill and causes market confusion. This causes consumers to confuse and misidentify the source of the goods, which violates the principles of good faith and recognized business ethics and constitutes unfair competition.”
This isn’t the first time New Balance has found itself in a legal fight against Chinese companies. Over the years, copycat brands out east — with similar designs, similar names, and even storefronts — have proved a thorn in the side. This came to a head three years ago when it won $1.5 million in damages against three companies, including New Boom and New Bunren in what was described as a landmark case. “If the China marketplace can be thought of as a schoolyard, New Balance wants to make it abundantly clear we are the wrong kid to pick on,” said New Balance’s senior counsel for intellectual property, Daniel McKinnon, at the time.
Of course, New Balance isn’t the only brand to run into these copyright issues out in China — Supreme’s struggle, in particular, is well documented. Following the Michael Jordan vs. Qiaodan case (reported on here last week), Song Xiaoming, head of the Supreme People’s Court’s Intellectual Property Tribunal, spoke of the need for increased trademark protection throughout the country. “We must say ‘no’ for those who rush registration for trademarks with bad intention, as honesty and credibility have always been the principles when we handle trademark cases,” he said.
New Barlun has been ordered to pay $1.5 million in damages and legal fees to New Balance. Not only that, but the Fujian-based company will have to cease its use of the controversial “N” logo, before issuing a “public clarification” about its use of it.