83 : 83

[Judge Dongtao Li]

The Facts

The plaintiff is company A, and the defendant is company B. Both of them are producers of portable speaker systems, which are sold nationwide in China.

In June 1998, company B brought an action against company A for unfair competition based on false advertising. Through mediation by the court, company A admitted its infringement and both parties comprised and reached a settlement agreement. 

Afterwards, company B published information on the case on its website for 83 days, including comments about company A that were highly critical and used derogatory language.  In addition, company B uploaded the indictment and the Court mediation document on a particular webpage that was linked with the comments on the homepage.

The Court didn’t support the defendant’s claim in some contents of the indictment, such as "the defendant (company A) infringed the plaintiff (company B)'s trademark". 

The plaintiff sued the defendant for unfair competition(disparagement)and asked the latter to:

(1) Stop the infringement (delete the false ad at its website) and Apologize to the plaintiff publicly in some media and its websitefor 83 days;

(2) Compensate RMB 13,840 yuan.

The defendant argued the unfair competition was not established because the information on his website was true, and it was legal to upload and publish the indictment and the mediation document.

Opinion

The court held that the defendant published derogatory remarks targeting the plaintiff and uploaded the indictment and the court mediation document from the previous case onto its website.

In this process, though the defendant did not alter original contents of the indictment and the mediation document, some information in the indictment had not been supported by the Court, thus committing sufficient damage to the goodwill and product reputation of the plaintiff. 

The plaintiff sought compensatory damages for RMB 13,840 yuan, but failed to submit any pieces of evidence in support thereof, this part of the pleading shall be rejected by the court.

According to Article 134.1(1) of the Civil Law Code of PRC[1], Article 2.1 and 14 of the Law Against Unfair Competition of PRC[2], the court held that:

1. The Defendant shall stop infringement (disparaging the plaintiff’s good will) upon the effective date of this Judgment.

2. The defendant shall publish an apology on the homepage of its website for 83 days continuously to the plaintiff within 15 days upon the effective date of this Judgment;

Contents of the apology shall be approved by this Court. If the defendant refuses to comply, the Court will publish the Judgment at a media website. The cost and expenses occurred should be borne by the defendant.

3. Other pleadings of the plaintiff shall be rejected.

After verdict, no party appealed.


[1]Article 134. The main methods of bearing civil liability shall be: 

(1)cessation of infringements;

[2]Article 2.1 Managers shall abide by the principle of voluntariness, equality, impartiality, honesty and good faith, and also adhere to public commercial moral in their business transactions.
Article 14 Manager shall not fabricate, spread false facts to damage the goodwill and product reputation of the other competitor.