Tencent and Chery scramble for 'QQ' trademark

Tencent and Chery Automobile started a "war" to claim ownership of the trademark "QQ" for vehicles during the trial in Beijing First Intermediate People's Court on July 16. Tencent has brought a suit against the Trademark Appeal Board of the State Administration for Industry & Commerce.

Chery, the third party, in order to defend its own interests and rights, acted even more aggressively than the defendant, the Trademark Appeal Board. The court did not pass a judgment right after the trial.

In fact, the two companies have been fighting against each other for "QQ" since 2005. During the time-consuming trademark war, the automobile trademark registered by Tencent was annulled by the Trademark Appeal Board due to Chery's dissent. The trademark registered by Chery is under the review of adjudication on opposition, leaving Chery with no ratified trademark of "QQ".

On May 19, 2005, Tencent applied to register the trademark "QQ" as a Class 12 commodity, which includes automobiles. The application was granted on March 7, 2008. Chery, the third party in the case, applied to the Trademark Appeal Board to withdraw approval of the controversial trademark on the grounds that the registration violated the Trademark Law in regards to Article 13 (reproduction or imitation of a well-known trademark), Article 28 (identical with or similar to another person's trademark), and Article 31 (infringing upon another party's existing prior rights).

The defendant, the Trademark Appeal Board, then ruled that Tencent registered "a mark that is already in use by another party and that enjoys substantial influence" (Trademark Law Article 31) and withdrew the registration.

Tencent, the plaintiff, believes that the Trademark Appeal Board's ruling was only based on some segments of the Trademark Law. An agent of Tencent said that Article 31 stipulates, "Nor shall an applicant rush to register in an unfair manner a mark that is already in use by another party and that enjoys substantial influence". Tencent did not use unfair methods and Chery did not legally use the trademark. Thus, Chery's prior rights do not exist.

Tencent's agent claimed that defensive registration in every field was necessary as Tencent sales reached 900 million yuan ($146.6 million) in 2003. In fact, Tencent registered the No 1962825 trademark for the artistic style of "QQ" as a Class 12 commodity before Chery labeled "QQ" on its commodities. Thus, it is entirely legitimate that Tencent further register "QQ" based on its former "QQ" designs.

Tencent's agent also alleged that Chery has been taking advantage of Tencent's famous trademark "QQ" and the penguin figure to promote its automobiles for quite a long time. This kind of tort does not indicate existing prior rights. On the contrary, it is Chery that infringed and is infringing on Tencent’s existing prior rights via the use of the "QQ" trademark.

Chery disagrees with Tencent's statements. Chery believes that the controversial No 4665825 "QQ" trademark is in no way similar to the No 1977837 "QQ" registered by Tencent but is actually a different, independent trademark. The former uses English letters while the latter features a mouse-like trademark. Therefore, Tencent’s act is not a further registration based on the No 1977837 "QQ".

Chery's agent claimed that there is a strict auto market access system in China. According to the auto industrial policy, a company may not produce automobiles without an auto industry background. Tencent's registration in the auto field is malicious for Chery. "Once the court approves Tencent's registration, there will be a lot of vehicles labeled QQ around China," the agent said.

In addition, Wu Hu Chery Technology Co, an affiliated company of Chery, registered the No 3494779 "QQ" as a Class 12 commodity before Tencent registered the controversial trademark.