China's Wahaha Wins Court Victory in Trademark Dispute

Danone says it will pursue the case in a higher court.

A Chinese court has ruled that China's largest soft drink maker is the owner of the Wahaha trademark, ruling against France's Danone, the Chinese company's former partner, the companies said Aug. 5.

The Wahaha Group was the rightful owner of the brand name, the Hangzhou Intermediate People's Court said in a ruling dated July 30, that endorsed an arbitration decision from December, Wahaha said in a statement. "The dispute over the ownership of the Wahaha brand, which lasted more than one year, was finally settled and it was affirmed that Wahaha brand belongs to Wahaha," the Chinese drink maker said in a statement.

However, Danone plans to pursue the case at a higher court, Danone spokesman Michael Chu said in a statement. "Danone will continue to pursue all legal options to protect its contractual rights and financial interests," the company said.

The firms have been locked in a protracted and bitter feud over the ownership of the Wahaha brand name. The dispute involved a series of joint venture firms once lauded as a model of Sino-foreign cooperation.

Danone, which holds 51% of 39 joint venture companies with Wahaha, said it discovered Wahaha chairman Zong Qinghou had set up an entire production and distribution network, which operates in parallel to the joint ventures. It filed a lawsuit on June 4 last year for breach of agreement, accusing the Chinese beverage giant of selling Wahaha-branded drinks without its permission. The action sparked a series of retaliatory lawsuits in China and abroad, including in the United States and Sweden.

Wahaha spokesman Shan Qining said talks with Danone faltered because the two companies differed widely over the value of the joint ventures. "We would never give up solving the issue through talks, but it has to be based on mutual respect. We definitely cannot accept Danone's valuation," Shan said, without providing further detail.

Copyright Agence France-Presse, 2008

TAGS: Legislation
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