“TZEN MOA-CHI” Defeated “SENIOR TZEN MOA-CHI”
2011/02/26 TaiwanAfter 4 years of lawsuit, the litigation between “TZEN MOA-CHI” and “SENIOR TZEN MOA-CHI” finally comes to an end. The decision from the Supreme Court on July 9 2010 is in favor of “TZEN MOA-CHI”, and the defeated party is to pay a total of NTD1.1 million to compensate the loss incurred to “TZEN MOA-CHI”.
The trademark, “TZEN MOA-CHI”, was originated from Shuigang TZEN, a legendary figure that has been known for his handmade moachi throughout his life in Hualian. TZEN has never established a shop or register his trademark for making and selling his handmade moachi; instead, TZEN rode on a specially designed bicycle around the streets to sell his moachi. In 1996, TZEN’s youngest daughter and son-in-law learned from TZEN the technique of making moachi by hand. They then founded a shop using the name, “TZEN MOA-CHI”, in Hualian and commercially packaged their moachi for sell. Over the years, the founder of the shop was able to established 11 branch stores throughout Taiwan, and generated an annual turnover exceeding NTD100 million.
Shengming TZEN, the third son of Shuigang TZEN (the Father), was jealous of the profitability of “TZEN MOA-CHI”; therefore, he founded “SENIOR TZEN MOA-CHI” with his friend in November 2002 in Hualian. He also claimed that “SENIOR TZEN MOA-CHI” is the inheritor of the Father’s technique, and the competition between “TZEN MOA-CHI” and “SENIOR TZEN MOA-CHI” started.
In 2006, the founder of “TZEN MOA-CHI” initiated a lawsuit against “SENIOR TZEN MOA-CHI” for trademark infringement. He also claimed that “SENIOR TZEN MOA-CHI” has damaged the reputation and operation of “TZEN MOA-CHI”, and demanded “SENIOR TZEN MOA” to pay a total of NTD5.8 million to compensate the loss incurred to “TZEN MOA-CHI”. The lawsuit left the Father in an awkward position, while the third son also abused the Father with violence. The Father had no choice but to apply for restraining order. The restraining order was approved, and the Father moved to stay with his youngest daughter.
A year after the lawsuit started, the Father passed away. The verdict from the Hualian District Court was to have the founder of “SENIOR TZEN MOA-CHI” serving in prison for 6 months or pay a fine decided by Court. As for the civil case, “SENIOR TZEN MOA-CHI” is to pay a total of NTD1.6 million to compensate the loss incurred to “TZEN MOA-CHI”.
Following the defeat, the founder of “SENIOR TZEN MOA-CHI” appealed the decision to the Supreme Court. The Supreme Court commented after trial that since “TZEN MOA-CHI” has been well-known to the general consumer in Taiwan, the unauthorized use of “TZEN MOA-CHI” has clearly violated Rule 16 of the Enforcement Rule of the Trademark Law and Article 23 (1) (XII) of the Trademark Law. Even though the founder of “SENIOR TZEN MOA-CHI” tries to distinguish its mark from “TZEN MOA-CHI” by adding the word “Senior”, such a choice of word, together with the use of the Father’s portrait, have the effect of misleading the consumers into thinking that “SENIOR TZEN” is the inheritor of the Father’s technique or that the two companies have business relationship or licensing agreement. Consequently, “SENIOR TZEN MOA-CHI” has clearly infringed the trademark right of “TZEN MOA-CHI”, and violated Rule 16 of the Enforcement Rule of the Trademark Law, Article 23 (1) (XII), Article 23 (1) (XVI) and Article 62 (1) (I) of the Trademark Law. Therefore, according to Article 61 of the Trademark Law, “TZEN MOA-CHI” is eligible of demanding “SENIOR TZEN MOA-CHI” for a lump sum payment to compensate its loss.
As for the lump sum to be paid by “SENIOR TZEN MOA-CHI”, the Judge noticed that the turnover for “TZEN MOA-CHI” from 2005 to 2007 all exceeded NTD 100 million per year, while that for “SENIOR TZEN MOA-CHI” was around NTD 1.6 million per year. Consequently, the loss incurred to “TZEN MOA-CHI” was not significant. Taking into consideration the financially ability of “SENIOR TZEN MOA-CHI”, the Judge ordered the defeated party to pay a total of NTD1.1 million to compensate the loss incurred to “TZEN MOA-CHI.”
Organized and translated by Tony Chen
International Affairs
