The de-linkage and re-linkage between trademark use and damages in China
The alienation of the function of trademark has become a serious social problem in China. In many trademark cases, judges ignored the relationship between the formulas of damages calculation and the compensatory principle, and simply presumed the damages based on the infringer’s whole profits regardless of the context of the cases. In the present case, the courts refused to grant damages as remedy to the plaintiffs on the basis of the fact that the trademark at dispute had not been actually used. The function of the trademark has been distorted from distinguishing the sources of commodities to speculating and extorting. The issue of malicious filings of trademarks has also drawn attention from the international society. The first-instance court held that the defendants infringed registered trademark and should stop using , but no damages should be compensated. Both parties appealed and the appeal court upheld the first-instance decision.