Local bike manufacturer, Aster Bikes, found liable for infringement by making a false claim of co-branding with Ferrari

　In 2016, Aster Bikes Technology Co., Ltd. (Chinese: 亞仕大科技股份有限公司, hereinafter “Aster Bikes”) claimed to work with the worldwide famous brand, FERRARI, to launch a co-branded bicycle to be priced at TWD288,000, but now this alleged cooperation ended up with nothing at all.  With respect to Aster Bikes’ unilateral claim, Ferrari S.P.A. (hereinafter “Ferrari”) filed a lawsuit against Aster Bikes with the Taiwan IP Court, and the IP Court ruled that Aster Bikes shall be enjoined from using Ferrari’s trademarks for manufacturing, selling, or promoting its products and that Aster Bikes and responsible person thereof shall be held jointly and severally accountable for damages of TWD1 million to Ferrari.  This case is appealable.  

　Aster Bikes asserts on its company website that the quality of their road bikes and the profession of manufacturing them have been well recognized by the worldwide well-known brands, Lamborghini and FERRARI, and in this regard, Aster Bikes are duly authorized by Lamborghini and FERRARI to manufacture co-branded AF7 road bikes.  Ferrari negated such co-branding cooperation asserted by Aster Bikes.  

　Confronting Aster Bikes’ false assertion, Ferrari filed a lawsuit against Aster Bikes and pointed out a fact that Aster Bikes indeed had once contacted Ferrari through a cooperative Hong Kong-based company, but Ferrari also gave to the Hong Kong company its disapproval of allowing any third party to be part of a trademark licensing project.  That is to say, Ferrari has never agreed to Aster Bikes’ proposed trademark licensing plan nor started any cooperation with Aster Bikes.  The fact is, however, that Aster Bikes still used Ferrari’s trademark and device to manufacture bikes and also declared that they are duly authorized by Ferrari for co-branding.  Apparently, Aster Bikes’ foregoing act has constituted infringement.  

 　Aster Bikes beat the infringement alleged against it by arguing that all of their bikes carry Ferrari’s anti-counterfeit labels and they indeed have paid royalty to acquire the labels.  

　However, both the supplier of anti-counterfeit labels and the said Hong Kong company testified that the scope of licensing to Aster Bikes is limited only to parts; that is to say, Aster Bikes can only sell parts bearing Ferrari’s anti-counterfeit labels, rather than parts assembly. 

　In view of the foregoing, even though Aster Bikes legally acquired Ferrari’s authorization in using the anti-counterfeit labels, the IP Court still sustained Aster Bikes’ infringement on the ground that Aster Bikes apparently caused consumers confusion by (1) using Ferrari’s anti-counterfeit labels outside the authorized scope, and (2) falsely claiming the co-branding with Ferrari for sale without clarifying that only the frames of their bike products are related to Ferrari.  (November 2019) 

/CCS