Invalidation against a Trademark Registered for Over Five Years and Determination of Bad Faith under Paragraph 2, Article 58 of the Trademark Act – Supreme Administrative Court Judgment 112 Shang No. 664

09/26/2025

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I.              Facts of the Case

 

1.            The Plaintiff's predecessor "Jing-Hua Classic Aesthetic Clinic, Hsiao, I-Chun" filed an application with the Taiwan Intellectual Property Office (hereinafter “TIPO”) on October 25, 2012 to register the trademark “” (Jing-Hua Plastic Surgery and device) for services in Class 44 under Article 19 of the then-effective Enforcement Rules of the Trademark Act, including “hairdressing, beauty salons, saunas, skin care, slimming and body shaping, beauty consultation, massage, aromatherapy services, medical services, clinics, plastic surgery, various pathological examinations, pharmaceutical dispensing, medical consultation, and health consultation.” Upon examination, TIPO approved the application and registered the trademark under No. 1592586 (hereinafter “the trademark at issue”). Subsequently, on September 3, 2020, the Intervener “Formosa International Hotels Corporation” filed for invalidation of the trademark at issue on the basis of its registered word marks “” (Jing-Hua GRAND FORMOSA) and “晶華” (Jing-Hua word mark in Chinese), asserting that the trademark at issue violated Item 11, Paragraph 1, Article 30 of the Trademark Act.

 

2.            Upon examination, TIPO determined that although the Intervener’s request for invalidation was filed after the five-year exclusion period stipulated in Paragraph 1, Article 58 of the Trademark Act, the trademark at issue was subject to the application of the forepart of Item 11, Paragraph 1, Article 30 and Paragraph 2, Article 58 of the Trademark Act. Accordingly, TIPO issued Invalidation Decision H01090113 on March 30, 2022, to revoke the registration of the trademark at issue.

 

3.            Dissatisfied with the Appeal Decision, the Plaintiff initiated administrative litigation. The Intellectual Property and Commercial Court 111 Xing-Shang-Su No. 75 found the Plaintiff’s claims for revocation of TIPO's Invalidation Decision and the Appeal Decision to be groundless and dismissed the Plaintiff’s suit. Upon further appeal, the Supreme Administrative Court 112 Shang No. 664 held that the appeal was without merit, thereby confirming the revocation of the registration of the trademark at issue.

 

II.           Main Issues of the Case

 

1.            Whether the Intervener's trademarks cited for invalidation are well-known trademarks

2.            Whether the registration of the trademark at issue was made in bad faith as stipulated in Paragraph 2, Article 58 of the Trademark Act, and thus not subject to the five-year exclusion period under Paragraph 1 of the same Article

3.            Whether the registration of the trademark at issue constitute the forepart of Item 11, Paragraph 1, Article 30 of the Trademark Act.

 

III.        Findings of the Courts

 

1.            Established in 1976, the Intervener has successively obtained and continuously used the trademark “” (Jing-Hua GRAND FORMOSA) cited for invalidation for hotel and lodging services since 1992. The mark was previously recognized as a well-known trademark by TIPO in 2004 through its Trademark Opposition Decisions. It is thus evident that the Intervener’s “晶華” (Jing-Hua word mark in Chinese) characters as a chain hotel brand have become widely recognized among relevant businesses and consumers in Taiwan, signifying reputation and quality in restaurant, hotel, and lodging services. Therefore, at the time of application for registration of the trademark at issue, the trademark cited for invalidation was already a well-known trademark.

 

2.            Pursuant to Article 58 of the Trademark Act, where the registration of a trademark is in violation of Article 30, Paragraph 1, Subparagraph 11 of the same Act, an application for invalidation may not be filed after five years from the date of publication of registration (Paragraph 1). However, if the registration was made in bad faith, the five-year limitation does not apply (Paragraph 2).

 

In its finding, the Intellectual Property and Commercial Court held that the Plaintiff, after obtaining registration of the trademark at issue, displayed on its website a photograph of its clinic’s signboard at the same location as the Intervener’s Regent Hotel building. In fact, the Plaintiff’s business premises are adjacent to those of the Intervener (the Intervener’s address: 1F. to 20F., No. 3, Ln. 39, Sec. 2, Zhongshan N. Rd., Zhongshan Dist., Taipei City; the Plaintiff’s address: 3F., No. 2-2 at the same lane and road). The photograph, which simultaneously shows the physical buildings of “Jing-Hua Aesthetic Clinic” and “Regent Hotel,” reflects the Plaintiff's attempt to create an impression for consumers of a connection between the two. As previously stated, at the time of application for registration of the trademark at issue, the trademarks cited for invalidation were already well known. The Plaintiff, when applying for registration of the trademark at issue or when opening “Jing-Hua Aesthetic Clinic” adjacent to the Intervener’s “Regent Hotel,” was clearly aware of the existence of the trademark cited for invalidation. Nevertheless, the Plaintiff applied for registration of a name similar to the trademark cited for invalidation, which is evidently not in good faith. Therefore, although the Intervener did not file for invalidation until September 3, 2020, more than five years after the publication of the registration of the trademark at issue, the application was not time-barred given the legislative purpose of Paragraph 2, Article 58 of the Trademark Act.

 

The Supreme Administrative Court further gave the following reasons for the amendment to Paragraph 2, Article 58 of the current Trademark Act, as amended on May 28, 2003: "Where the registration of a trademark is in violation of the amended Item 12, Paragraph 1, Article 23 and such registration was obtained in bad faith, the registrant, having sought to benefit from unfair competition, should not be protected by any time limitation, in reference to Article 6bis (3) of the Paris Convention for the Protection of Industrial Property; and hence it is provided in Paragraph 3 that 'the exclusion period stipulated in Paragraph 1 shall not apply.'" According to the interpretation of Article 6bis (3) of the Paris Convention: “Generally, if the proprietor or user of a registered mark is aware of the existence of a well-known mark and intends, by registering or using a conflicting mark, to cause confusion and benefit therefrom, such conduct constitutes ‘bad faith.’” Thus, if the trademark owner is aware of the existence of another’s well-known trademark or mark and intends to cause confusion by registering a conflicting trademark to benefit from unfair competition, such conduct constitutes bad faith as referred to in the above provision. The Intellectual Property and Commercial Court did not find bad faith solely on the basis of the Appellant’s “awareness” of the Intervener’s well-known trademark, and it also explained that the Appellant intended to create an association between the two in the minds of consumers and applied for registration of the trademark at issue featuring a similar name, thereby evidencing an intention to free-ride on the reputation of the well-known trademark cited for invalidation to benefit from unfair competition.

 

3.            Given the principle of observing a trademark in its entirety, although the trademark at issue also contains an illustration of a face profile and a human figure formed by connecting upper and lower heart shapes, these elements cannot be readily pronounced verbally. From the perspective of ordinary consumers in Taiwan, the Chinese characters “晶華整形外科” (Jing-Hua Plastic Surgery in Chinese) would be the primary part for identification. However, as the four Chinese characters "整形外科" (Plastic Surgery in Chinese) merely describe the nature of the services and lack distinctiveness, consumers would clearly rely on the two characters “晶華” (Jing-Hua in Chinese) as the main distinguishing element, which is identical to the main part of the trademarks cited for invalidation. Therefore, the trademark at issue and the trademarks cited for invalidation are similar to a significant degree. The trademark at issue is designated for Class 44 services such as “hairdressing, beauty salons, saunas, skin care, slimming and body shaping, beauty consultation, massage, aromatherapy services, medical services, clinics, plastic surgery, various pathological examinations, pharmaceutical dispensing, medical consultation, and health consultation,” while the trademark cited for invalidation is designated for goods in Classes 7, 10 and 12 applicable prior to amendment and services in Classes 35, 37, 41, 43, 44, and 45, with services in Class 44 such as beauty, slimming, and massage being identical or highly similar, and the channels and target consumers of both overlapping to a high degree. Furthermore, the trademarks cited for invalidation are well-known trademarks, and the Intervener has long provided diversified services through its diversified business operations (e.g., beauty, hairdressing, sauna, and massage services are commonly offered within the hotel and lodging premises operated by the Intervener, a fact widely recognized by relevant consumers; in cross-industry collaborations, the Intervener’s hospitality services are often shown in conjunction with beauty packages purchased by consumers for consumer selection). Considering also the Plaintiff’s lack of good faith in registering the trademark at issue, it is sufficient to conclude that the registration of the trademark at issue is likely to cause relevant consumers to misidentify the source of the goods or services as being the same as, or related to, those of the trademark cited for invalidation. Therefore, TIPO’s determination that the forepart of Item 11, Paragraph 1, Article 30 of the Trademark Act applies to the registration of the trademark at issue and its disposition to revoke the registration is not erroneous.

 

IV.        Key Takeaways

 

1.       Rights holders should be mindful of the exclusion periods for filing oppositions and invalidations to avoid increasing the burden of proof in trademark disputes.

 

The post-registration public examination system under the current Trademark Act includes both the opposition and invalidation systems. Aside from differences in applicant qualifications, the primary consideration for rights holders in choosing between the two systems is the exclusion period for filing. The period for filing a trademark opposition is within three months from the date of publication of registration (Paragraph 1, Article 48 of the Trademark Act), while the period for filing an invalidation is, in principle, within five years from the date of publication of registration (Paragraph 1, Article 58 of the Trademark Act).

 

If a rights holder wishes to cancel the registration of a trademark registered for over five years through public examination mechanisms, they must additionally adduce evidence that the registration was made in bad faith and in violation of Article 30, Paragraph 1, Subparagraph 9 or 11 of the Trademark Act, to exceptionally apply for invalidation with TIPO (Paragraph 2, Article 58 of the Trademark Act).

 

Furthermore, where invalidation is sought on the grounds of violation of Item 10, Paragraph 1, Article 30 of the Trademark Act, and the trademark cited for invalidation has been registered for over three years, the applicant must submit proof of use of the trademark cited for invalidation for the goods or services cited for its claims within three years of filing the invalidation, or evidence of justifiable reasons for non-use (Paragraphs 2 and 3, Article 57 of the Trademark Act). Conversely, if an opposition is filed within three months of publication on the same grounds, the applicant is not required by law to submit proof of use of the trademark cited for opposition.

 

2.       Bad faith as defined under Article 58, Paragraph 2 of the Trademark Act requires not only knowledge but also the intent to benefit from unfair competition.

 

Bad faith may sometimes refer to mere knowledge of something or to subjective elements of deliberate intent, and may be interpreted differently under various legal systems. The term "bad faith" as defined under Paragraph 2, Article 58 of the Trademark Act, it is explained in the legislative rationale of the Article and Paragraphs 2 and 3 of Article 6^bis of the Paris Convention for the Protection of Industrial Property: "(2) A period of at least five years from the date of registration shall be allowed for requesting the cancellation of such a mark. The countries of the Union may provide for a period within which the prohibition of use must be requested." and "(3) No time limit shall be fixed for requesting the cancellation or the prohibition of the use of marks registered or used in bad faith."[1]

 

According to the “Interpretation of the Paris Convention” published by TIPO, bad faith is interpreted as follows: “The administrative or judicial authority will determine whether the registration or use of a conflicting mark is in bad faith. If it is determined to be so, there is no limitation period for filing an application. Generally, if the proprietor or user of a registered mark is aware of the existence of a well-known mark and intends, by registering or using a conflicting mark, to cause confusion and benefit therefrom, such conduct constitutes bad faith.”[2] Accordingly, bad faith under Paragraph 2, Article 58 of the Trademark Act does not refer to mere knowledge, but requires, in addition to knowledge of another’s well-known trademark, the intent to cause confusion through the registration or use of a conflicting mark in order to benefit therefrom. This standard was elaborated and affirmed in the Supreme Administrative Court Judgment 112 Shang No. 664.

 

3.       Businesses should actively use their registered trademarks and retain evidence supporting the well-known status of their trademarks, and boost efforts at trademark monitoring to timely safeguard trademark rights and prevent trademark dilution.

 

Brand building and protection often require significant investment in advertising and marketing. In particular, the creation of a well-known trademark typically depends on years of continuous operation and resource input by the business. However, as a trademark’s reputation grows, it may also attract unscrupulous parties seeking to free-ride on the goodwill accumulated by the business by applying for or using similar trademarks for their own goods or services. Regardless of whether such parties are competitors or whether their registration or use is likely to cause consumer confusion, failure to monitor new trademark applications or publications of registrations may result in the existence of similar trademarks in the market or on the trademark register. The quality of goods or services offered under such similar trademarks is beyond the business’s control, and in the worst-case scenario, it may lead to trademark dilution, diminishing the distinctiveness of the trademark. This will cause the trademark serving as an indicator of the source of goods or services to lose this source-indicating function, thereby severely damaging brand image and eroding brand value.

 

Given that there are currently few cases in practice recognizing trademark dilution under the latter part of Item 11, Paragraph 1, Article 30 of the Trademark Act, there may be gaps in protection of the rights and interests of trademark owners. Businesses should, in addition to actively using trademarks in marketing, increase efforts at monitoring trademark applications and registrations in order to timely track market developments and enforce and protect trademark-related rights at the most opportune time.