China Food

Whose oolong tea? Suntory and Huiyuan, the joint venture, staged a battle for trademark rights!

Huiyuan and its Japanese joint venture Suntory chose to go to court over the trademark rights of several well-known products such as “Suntory” oolong tea. The latest verdict is that Huiyuan has lost this rather dramatic battle.

Xiaoshidai noted that on September 3, China judicial document website released the second instance civil judgment on trademark infringement dispute between Beijing Huiyuan food and Beverage Co., Ltd., Shanghai Huiyin Food Co., Ltd. and Huiyuan sundeli (Shanghai) beverage Co., Ltd., which was signed on March 27 this year and was judged by the Shanghai Intellectual Property court.

According to the above judgment, Beijing Huiyuan, Shanghai Huiyin (Note: the shareholder is Beijing Huiyuan), Suqian Huiyuan, Dezhou Huiyuan, Shandong Huiyuan, Huiyuan Kaifeng and Yongchun Huiyuan are alleged to have infringed on the exclusive right to use the registered trademark of Huiyuan suneli, a joint venture company of both parties. The amount of infringement compensation is RMB 6.3161 million yuan. The judgment is final.

The above judgment shows that the infringed joint ownership There are 24 well-known registered trademarks such as “Suntory”, “Suntory” and “liqu latte”, involving a variety of products, including sandley oolong tea, sandley oolong tea low sugar, sandley oolong tea sugar free, sandley orange juice beverage, Qinling water, Qintao water, Rittal latte coffee, sandley American coffee, sandley honey warm grapefruit, sandley honey warm orange, etc.

At the same time, snacks generation noticed that the relationship between the two sides seems to be more delicate. For example, the operator of santeli food flagship store opened on tmall platform and the operation and certification subject of official wechat official account of Suntory beverage have been changed a few days ago, and they are no longer the joint venture “Huiyuan sandley (Shanghai) beverage Co., Ltd.”.

Now, what will happen to the CP, which has been “allied” since 2014?

Illegal production?

Let’s take a look at the infringement lawsuit.

Looking up the above judgment, the cause of the dispute is simply that the shareholders of one side of the joint venture company, without the consent of the joint venture company, produce and sell the products which the joint venture company has the exclusive right to use the trademark.

If you have a good memory, or you will remember this: in 2014, Huiyuan, a domestic juice giant, and Suntory, a Japanese beverage giant, jointly announced the establishment of a joint venture company “Huiyuan Suntory” in China, and Suntory granted the joint venture the exclusive license to use the “Suntory” trademark in the Chinese market. At the same time, Suntory China transferred its 100% equity of Suntory food to Beijing Huiyuan, and then sandley food was changed into “Shanghai Huiyin Food Co., Ltd.” (i.e. Shanghai Huiyin).

According to the data, since January 2015, the joint venture “Huiyuan sandley” has entrusted Shanghai Huiyin Food Co., Ltd., Toyo beverage (Changshu) Co., Ltd. and Shanghai Bomi Food Co., Ltd. to produce and sell Suntory brand drinks by Beijing Huiyuan food and Beverage Co., Ltd.

But the latest verdict shows that the cooperation did not seem to last long.

According to the judgment, the joint venture claimed that it had not placed an order with Shanghai Huiyin Food Co., Ltd. after July 2016, and Beijing Huiyuan food and Beverage Co., Ltd. had not ordered Suntory brand drinks from the plaintiff after October 2017. However, in December 2017, it found that “counterfeit santeli products produced and sold without its legal authorization” appeared in Shanghai, involving several brands such as “oolong tea” and “liqu latte”.

Huiyuan Suntory believes that this violates the exclusive right of its trademark. Xiaoshidai noted that in this case, Shanghai Huiyin has paid Huiyuan Suntory monthly in the name of “trademark license fee” since December 2017, but Huiyuan Suntory does not recognize the nature of the fee.

“Without the consent of Huiyuan Suntory, Beijing Huiyuan, as a shareholder of Huiyuan Suntory, has no right to grant other entities the use of santeli series trademarks in the name of Huiyuan Suntory.” According to the judgment.

Prospects for cooperation

Along with this lawsuit judgment, there are some other “changes”.

Xiaoshidai noticed that the joint venture “Huiyuan Suntory” seems to fade out of the public view. For example, xiaoshidai found that the business entity of Suntory food flagship store had changed in the second quarter.

“The store operator has been changed from Huiyuan sandley (Shanghai) beverage Co., Ltd. to Shanghai kangzhicheng e-commerce Co., Ltd. on May 13, 2020.” The tmall page is displayed. In other words, the e-commerce platform business is no longer operated by the joint venture company.

According to industrial and commercial data, Shanghai kangzhicheng e-commerce Co., Ltd. is an e-commerce sales channel solution company with 70% of the shares held by natural persons. On the surface, there is no background of Suntory or Huiyuan investment.

It is interesting to see that the above-mentioned tmall flagship store also marked the manufacturer’s information in the introduction page of sandley oolong tea, liqu latte ready to drink coffee, qintaoshui and other commodities involved in the “infringement disturbance” mentioned above: “please identify the designated manufacturer of santeli food official flagship store, Toyo beverage (Changshu) Co., Ltd., and factory representative Code: D

The manufacturers of new products such as sandley fruit waterfall tea and sandley Qinpu water are also Toyo beverage (Changshu) Co., Ltd., but they are not involved in the above “infringement storm”, so there is no such reminder. Suntory soda produced by other third-party manufacturers did not appear such “recognition warning”.

Xiaoshidai also noticed that in May of this year, the operation subject of the official wechat official account of Suntory beverage also changed. On May 28, a statement released by the official company showed that it had moved from the old account subject “Huiyuan sandley (Shanghai) beverage Co., Ltd.” to the new account subject, “sandley (China) Investment Co., Ltd.”.

According to industrial and commercial data, Suntory (China) Investment Co., Ltd. is a wholly foreign-owned enterprise established by Suntory, and its only foreign investment is Huiyuan Suntory.

This shows that from the channel, production to publicity and promotion, Suntory seems to be “decoupling” from Huiyuan, although Huiyuan Suntory is still in existence.

According to official data, Suntory’s Chinese parent company, Suntory Holdings Co., Ltd., is “the world’s leading wine and beverage production and sales company”. Since 1984, Suntory has been engaged in beer business in China. Since 1995, Suntory began to sell “sandley oolong tea” and “Suntory fun latte”.

Recalling the alliance, Huiyuan Juice once described Suntory as a “strategic partner” to help Suntory sell and develop its products, especially tea and coffee, in the Chinese beverage market. At the same time, the two sides are expected to cooperate in product development, quality control and supply-demand system, so as to diversify Huiyuan juice products, especially tea and coffee drinks.

 

At that time, Huiyuan was still in its highlight moment, while Suntory beverage had been “in place” for a long time in China. Data from Euromonitor International, a market research company, shows that in the six years from 2006 to 2011, “Suntory” brand’s share of soft drinks in China has been about 0.8%, while that of “Huiyuan” brand is 1.7% – 2.0%.

But in the past few years, Huiyuan, which is exposed to debt risk, has obviously been overwhelmed. According to the financial report, the revenue of Huiyuan juice from 2013 to 2016 was 4.5 billion yuan, 4.592 billion yuan, 5.682 billion yuan and 5.74 billion yuan respectively. In 2017, Huiyuan Juice’s revenue declined to 5.382 billion yuan. Subsequently, the company did not announce the results in 2018 and 2019, and has suspended trading so far.

As of the time of publication, Nishi could not contact Suntory and Huiyuan for comment.

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