The first Intermediate People’ s Court of Shanghai

Plaintiffs:

Feng Chuyin, female, of Han nationality, born on April 3, 1923, with home address at 288-3 Wuyuan Road, Shanghai

Zhang Weiwei, female, of Han nationality, born on December 27, 1941, with home address at 234 Yunnanzhong Road, Shanghai

Zhang Xiao, female, of Han nationality, born on November 30, 1943, with home address at 288-3 Wuyuan Road, Shanghai

Zhang Rongrong, male, of Han nationality, born on December 16, 1945, with home address at 146-10 Yuqing Road

Zhang Duoduo1 female, of Han nationality, born on May 20, 1948, with home address at 29 Mody Road, Building 7, Kowloon, Hong Kong

Zhang Jianjun, male, of Han nationality, born on August 1, 1950, with home address at 45 Zhongshan Street, Jiaxing City, Zhejiang Province

Zhang Weijun, male, of Han nationality, with home address at 27 Mody Road, Building 6; Kowloon, Hong Kong

Zhang Sujun, male, of Han nationality, born on November 29, 1952, with home address at 2S8-3 Wuyuan Road, Shanghai

Representatives: Zhang Rongrong and Zhang Sujun

Authorized Attorneys: Tao Wuping, attorney- at-law of Shanghai Shenda Law Firm

Xu Yongjun, attorney-at-law of Shang-hai Shenda Law Firm

Defendant:

Jiangsu Sanmao Group Inc.

Address: xinqiao town, Jiangyin City, Jiangsu Province

Legal Representative: Zhou Jianping, the chairman of its hoard of directors

Authorized Attorneys: Zhou Huanrun, attorney-at-law of Bin-jiang Law Firm of Wuxi City

Ren Yan, attorney-at-law of Shanghai Tianren Law Firm

This court, after filing the case of copyright infringement Feng Chuyin and the Zhangs (namely, Zhang Weiwei, Zhang Xiao, Zhang Rongrong, Zhang DUOdUQ, Zhang Jianjun1 Zhang Weijun and Zhang Sujun) V. Sanmao Group Inc., has duly organized a col-legial panel and has held a public trial of the case. Plaintiff Zhang Rongrong and the attorney for the plaintiffs Tao Wuping, as well as Zhou Huanrun and Ren Yan, the attorneys for the defendant, ap-peared at the trial for argument. The hearing of the case has now come to a close.

In their complaint, the plaintiffs assert that the late artist Zhang Leping created a well-known cartoon picture story series fea-turing a boy Sanmao (three-hair). This series includes The Adven-tures of the Homeless Sanmac, Sanmao in the Army, New Adven-tures of San mao, etc.. The cartoon figure Sanmao, with his big three-haired head and round nose, has been recognized by the public as a piece of artistic work created by Zhang Leping, and Zhang Lep-mg owned the property rights in connection with this work of art. Upon the death of Zhang Leping, the relevant rights to the works created by him passed to and are now protected by his legal successors (the plaintiffs). The plaintiffs have found recently that the defendant, without obtaining consent from the successors of Zhang Leping, has registered the cartoon images of Sanmao as trademarks of the corporation and has used them widely. The plaintiffs hold that this is a serious infringement on the part of the defendant a-gainst Zhang Leping and his successors, and to protect the dignity of the law as well as their lawful interests, they have instituted this action, seeking a judgment enjoining the defendant to refrain from fur-ther infringements, to make a public apology in a newspaper, as well as to pay damages in the amount of RMB one million plus the cost for this case.

The defendant, having failed to submit a written answer with-in the period prescribed by law, contends at the trial that it acted in accordance with the Trademark Law in applying for registration of Sanmao as its trademarks, and so the application does not constitute an infringement. Besides, after the State Administration of Industry and Commerce verified and approved its application for registration of the Sanmao trademarks in accordance with the law, it has been using the trademarks for lawful purposes. Therefore the use of the trademarks does not constitute an infringement against the plain-tiffs. The defendant further contends that, as successors of the rights of the copyright owner, the plaintiffs are not entitled to inherit the personal rights of the copyright owner, and thus, their demand for an apology is not supported by law. Their one-million-yuan damages claim is groundless both as a matter of law and as a matter of fact.

This court has found through investigation that the plaintiffs Feng Chuyin, Zhang Weiwei, Zhang Xiao, Zhang Rongrong, Zhang Duoduo, Zhang Jianjun, Zhang Weijun, Zhang Sujun are the spouse and children of Zhang Leping, who died in September 1993. Between the l940’s and the 1980’s, Zhang Leping created the cartoon image of Sanmao with its big three-haired head and rounded nose, in his representative works Sanmao in the Army, The Adventures of the Homeless Sanmao, etc. On February 16, 1996, the copyright office of Shanghai Municipality approved the application for registration of Zhang Leping’ s Sanmao as a work of fine art, and the registration number is ZuoflengZhi 09-96-F-002.

Early in 1996, the plaintiffs found that products carrying the cartoon images of Sanmao as trademarks were being sold by the defendant, who also used the cartoon images of Sanmao as its logo in outdoor advertisements, on cards of employees, in newspapers and magazines and on internal nameplates.

Besides, this Court has also found that, between November 28, 1995 and February 28, 1996, the defendant applied for registration to the State Administration of Industry and Commerce of 38 trademarks carrying the cartoon images of Sanmao, of which 31 were verified and approved. During the same peri6d, the defendant made 111, 030 trademark representations carrying the cartoon images of Sanmao, of which 34,030 are still in the inventory. The local administrative department of industry and commerce certifies that the defendant has only used the registered trademark of Sanmao on its worsted woolen cloth.

The defendant claimed that the images of the boy it used are trademarks designed by a local artist it engaged. They have no relation with the cartoon picture figure claimed by the plaintiffs.

This Court holds that the big, three-haired head with the round nose is a cartoon picture figure created by the late artist Zhang Leping, who therefore was the copyright owner. Upon the death of Zhang Le ping, the plaintiffs in the instant case became his successors with respect to the copyright, who, within the statutory protection period, shall have the right to exploit, as well as the right to be remunerated for the exploitation of, the creative works, and whose lawful rights shall be protected in accordance with the law. The defendant alleges that the trademarks are designed by a local artist it engaged. However, the defendant used the cartoon picture images of Sanmao in its application for trademark registration and as a logo of the enterprise. In so doing it infringed upon the copyrights of the plaintiffs, and shall be held liable for the unauthorized use of the cartoon image of Sanmao. Therefore, the assertions that the trademarks are registered with due verification and approval, and its use of the trademarks is lawful, are without merit. What the plain-tiffs have inherited is the property rights of the copyright owner. The request that defendant make a public apology in a newspaper has no legal basis, and this court will not support such a request. As to the plaintiffs’ one-million-yuan damages claim, plaintiffs have not produced adequate proof to prove the damages. This court, in consideration of the fact that the plaintiffs have incurred some expenses in challenging the infringement, and that the defendant has used 77, 000 trademark representations carrying the Sanmao image, holds that the defendant shall compensate the plaintiffs for the latter’ losses, as the circumstances warrant. Pursuant to Article 118, clauses I and 7 of Paragraph 1, and Paragraph 2 of Article 134, of General Principles of Civil Law of the People’ s Republic of Chi-na, Clause 5 of Article 10, Paragraph 1 of Article 19, and Clause 6 of Article 45, of the Copyright Law of the People’ s Republic of China, Clause 6 of Article 3 and Clause 1 of Paragraph 1 of Article 10 of the Law of Succession of the People’ s Republic of China, the trial committee of this court hereby decides as follows after discussion:

1. Defendant Jiangsu Sanmao Group Inc. shall be enjoined from using the cartoon images of Sanmao in its products and logos.

2. Defendant Jiangsu Sanmab Group Inc. shall pay to Feng Chuyin, Zhang Weiwei, Zhang Xiao, Zhang Rongrong, Zhang Duoduo, Zhang Jianjun, Zhang Weijun, and Zhang Sujun damages in the amount of 100′ 000 yuan, and such damages shall be paid within ten days after this judgment becomes effective.

3. This Court does not support the other claims of the plaintiffs Feng Chuyin, Zhang Weiwei, Zhang Xiao, Zhang Rongrong, Zhang DuQduo, Zhang Jianjun, Zhang Weijun, and Zhang Sujun.

The cost for this case is RMB159 010, of which the plaintiffs shall pay 8,000 and the defendant shall pay 7,010 yuan, and the respective sums shall be paid within 10 days after this judgment takes effect.

If a party refuses to accept this judgment as final, it may sub-mit its appeal petition to this Court within 15 days after service of this judgment, together with a sufficient number of duplicated copies for each person of the opposing party to have one copy, and the appeal shall be filed with the Higher People’s Court of Shanghai.

Presiding Judge: Sun Aimin

Acting Judge: Li Shulan

Acting Judge: Bei Yongqing

Date: Feb. 26, 1997

Court Clerk: Liu Hong

 

The Higher People’ S Court of Shanghai

Defendant-Appellant:

Jiangsu Sanmao Group, Inc.

Address: Xinqiao Town, Jiangyin City, Jiangsu Province

Legal Representative: Zhou Jianping, Chairman of the Board of Directors

Authorized Attorneys: Tao Xiaohua, deputy general manager of the company

Ye Dongnan, attorney-at-law of Guotai Law Firm, Suzhou

Plaintiff-appellees:

Feng Chuyin, female, of Han nationality, born on April 3, 1923, with home address at 288-3 Wuyuan Road, Shanghai

Zhang Weiwei, female, of Han nationality, born on December 27 1941, with home address at 234 Yunnanzhong Road, Shanghai

Zhang Xiao, female, of Han nationality, born on November 30, 1943, with home address at 288-3 Wuyuan Road, Shanghai

Zhang Rongrong, male, of Han nationality, born on December 16, 1945, with home address at 146-10 Yuqing Road

Zhang Duoduo, female, of Han nationality, born on May 20, 1948, with home address at 29 Mody Road, Bu~ding 7, Kowloon, Hong Kong

Zhang Jianjun, male, of Han nationality, born on August 1, 1950, with home address at 45 Zhongshan Street, Jiaxing City, Zhejiang Province

Zhang Weijun, male, of Han nationality, with home address at 27 Mody Road, Building 6, Kowloon, Hong Kong

Zhang Sujun, male, of Han nationality, born on November 29, 1952, with home address at 288-3 Wuyuan Road

Representatives: Zhang Rongrong and Zhang Sujun

Authorized Attorney: Tao Wuping, attorney-at-law of Shanghai Shenda Law Firm

The appellant, Jiangsu Sanmao Group kc., refusing to accept as final the judgment of the First Intermediate People’ s Court of Shanghai filed as 1996 Hu Yi-Zhong-Min-Chu-( Zhi )-Zi-94 for a case of copyright infringement, has lodged this appeal with this Court. This Court, after forming a collegial panel, has had a public hearing of the case. Ye Dongnan and Tao Xiao Hua, attorneys for Appellant Jiangsu Sanmao Group Inc., and Zhang Rongrong, rep-resenting the appellees Feng Chuyin and the Zhangs, as well as their attorney Tao Wuping, appeared at the hearing for argument, and the hearing of this appeal has now come to a close.

The trial court found that the plaintiffs Feng Chuyin and the Zhangs are the spouse and children of Zhang Leping who died in September, 1993. Between the 1940’s and the 1980’s, Zhang Leping created the cartoon figure of Sanmao, with its big three-haired head and round nose. In February 1996, the Copyright Bureau of Shanghai Municipality approved the application for the registration of Zhang Leping’ Sanmao as a work of fine art. Early in 1996, the plaintiffs found that products carrying the cartoon images of Sanmao as trademarks were being sold by the defendant, who also used the cartoon images of Sanmao as its logo in outdoor advertisements, on cards of employees, in newspapers and magazines and on internal nameplates. Besides1 the court also found that, between November 1995 and February 1996, the defendant applied for registration to the State Administration of industry and Commerce of 38 trade-marks carrying the cartoon images of Sanmao, of which 31 were verified and approved. During the same period, the defendant made iii, 030 trademark representations carrying the cartoon images of Sanmao, of which 340, 30 are still in the inventory. The local administrative department of industry and commerce certified that the defendant had only used a registered trademark of Sanmao on its worsted woolen cloth.

The trial court held that the big, three-haired head with the round nose was a cartoon figure created by the late artist Zhang Leping, who therefore was its copyright owner. Upon the death of Zhang Leping, the plaintiffs in the instant case became his successors with respect to the copyright, who, within the statutory period of protection, should have the right to exploit, as well as the right to be remunerated for the exploitation of, the creative work, and whose lawful rights should be protected in accordance with the law. The defendant alleged that the trademarks were designed by a local artist it engaged. However, the defendant used the cartoon figure Sanmao in its application for trademark registration and as a logo of the enterprise In so doing it infringed upon the copyrights of the plaintiffs, and should be held liable for the unauthorized use of the cartoon figure Sanmao. Therefore, the assertions that the trade-marks were registered with due verification and approval, and that its use of the trademarks was lawful, were without merit. Because what the plaintiffs succeeded was the property rights of the copyright owner, their request that defendant make a public apology in a newspaper had no legal basis, and was not supported by the trial court. But the defendant should compensate the plaintiffs for their economic losses, as circumstances warranted. The judgment of the trial court was as follows: 1) Defendant should be enjoined from us-ing the cartoon images of Sanmao on its products and logos; 2) De-fendant Jiangsu Sanmao Group Inc. should pay to the eight plaintiffs damages iff the amount of 100, 000 yuan, and such damages should be paid within ten days after the judgment became effective; 3) The trial court would not support the other claims made by the eight plaintiffs. Of the 15, 010 yuan cost for the case, the plaintiffs should pay 8, 000 yuan and the defendant 7,010 yuan.

After the judgment was handed down, Jiangsu Sanmao Group Inc., refusing to accept the judgment as final, lodged its appeal with this Court – The appellant holds that, 1) Its use of the Sanmao trademarks does not constitute an infringement on the rights of the appellees. The creative notion of the Sanmao trademarks does not originate from Zhang Leping’ s Sanmao. The copyright of these trademarks should be owned by the designer of the trademarks in question, and the appellant should not be responsible for any of the legal consequences; 2) The Sanmao trademarks were duly registered after verification by the trademark bureau, and it was not used until it was found after public notification that no one challenged its use. Therefore, the appellant.’ S use of the trademarks is legitimate; 3) The. appellant has no obligation’ to compensate the appellees for the latter’s losses, because, a. the three-haired big head with the round nose is not a feature belonging only to Zhang Leping’ Sanmao, b. the copyright of the trademarks in question is owned by the design-er, and, has nothing to do with the appellant, c – the appeilees have incurred no economic losses, d. the trial court’ 5 judgment exceeds what the appellees asked for, and e. the procedure followed by the trial court in hearing the case is flawed. Based on these reasons, the appellant asks this Court to reverse the judgment below, and render a new and fair judgment.

This Court has found as a result of investigation that the findings of the trial court are substantially correct in all material facts. Zhang Leping, the antecessor of appellees Feng Chuyin et al., was a well-known cartoonist of this country – From March 1936 when The First Story Series of San mao came out to the reprint of The Complete Story of the Adventures of the Homeless San mao in October 1995, Zhang Leping had as many as 33 prints of various Sanmao cartoon picture stories, representative of which are The Adventures of the Homeless San mao, San mao in the Army, and New Adventures of Sanmao, etc.

This court holds that the big headed, three-haired boy Sanmao with a round nose was created independently by Zhang Leping who therefore owned its copyright. This copyright should be owned by the appellees, the lawful successors of Zhang Leping. Appellant Jiangsu Sanmao Group’ 5 contention that the figure of Sanmao was created by Oscar Jacobson of Sweden does not conform to the facts we have. The Sanmao created by Zhang Leping is a popular cartoon figure in China. Appellant has reason to know that unauthorized use of this figure as a trademark on their products amounts to a copy-right infringement. Appellant’ S allegations that the trademarks in question were designed by a third person, and that it should not be liable for the legal consequences thereof, are without merit as a matter of law, and this Court will not support such allegations. This case involves an infringement by the appellant upon an antecedent right of the appetlees, and therefore the appellant’s contention that, because the Sanmao trademarks have been registered , its use of the trademarks is lawful and constitutes no infringement is also ground-less. The trial court’ 5 decision to enjoin the appellant to pay dam-ages to the appellees pursuant to the appellees’ additional claim for damages is correct, and we therefore affirm the decision. We also hold that the trial court did not err on the procedure of trial, and the reasons presented on appeal by the appellant are without merit. In short, we how that the decision of the trial court was made upon findings of well-established facts after following the correct procedure, and that the application of law was also correct. In accordance with the provisions of Clause 1, Paragraph 1 of Article.153, and of Article 158 of Civil Procedure Law of the People’ s Republic of China, we affirm the judgment of the trial court.

The cost for this appeal, in the amount of RMB15, 010, shall be borne by the appellant Jiangsu Sanmao Group Inc.

This judgment is final.

Presiding Judge: Xu Jianchu

Acting Judge: Chen Zilong

Acting Judge: Deng Sicong

Date: August 19, 1997

Court Clerk: Li Lan