A Beijing court has ruled that U.S. e-commerce giant Amazon.com Inc.’s (AMZN) cloud service infringes on trademark rights, requiring the plaintiff, Beijing Yanhuang Yingxing Technology Development Co. to pay 76.46 million yuan in damages and not to continue using its trademark in China. In response, an Amazon spokesperson said that the company could not accept the verdict.
According to the Beijing High People’s Court, the “AWS” logo of Amazon Cloud Services is “closely related” to Yanhuang Yingxing’s registered trademark, and is generally considered by the relevant public to have a specific connection that is likely to cause confusion, whether the alleged infringement involves the purpose, content, manner and object of the service, or the sales channels and objects.
The court ordered Amazon to stop using “AWS” or any similar trademark in China and to pay the plaintiff 76.46 million RMB (approximately US$11 million) as financial compensation.
For its part, Amazon said the company is the first to use the trademark in China and will continue to appeal the case.
An Amazon spokesperson told US media, “Amazon started using the trademark many years ago and was the first company to use the trademark in China. We disagree with the court’s decision and have appealed the case to the High Court.”
“AWS” in English is an acronym for “Amazon Web Service,” a cloud computing service operated by Amazon.
In July 2018, Beijing ActionSoft Science & Technology Development Co., a Chinese software and data services company, sued Amazon and its partner –Ltd. for illegally using the “AWS” trademark.
According to its website, the company, which was founded in 2003, provides software services. The company claims that they applied for a trademark registration for “AWS” in 2004 and received authorization from the State Administration for Industry and Commerce of China on February 7, 2008.
Amazon began developing cloud computing in 2006 and has used “AWS” as its cloud computing brand in more than 190 countries worldwide. But Amazon’s cloud computing services entered the Chinese market in 2014, and in order to comply with the relevant regulatory requirements, Amazon chose to cooperate with Huanghuanxin.com to provide services in two regions, Beijing and Ningxia.
In late 2019, Amazon officially shut down its e-commerce business in China and no longer sells goods sourced in China, retaining only goods shipped directly to China from overseas regions such as Amazon USA and Amazon Japan, and its cloud computing program continues to operate in partnership with Chinese companies.
The Chinese Communist government has long been criticized for infringing on foreign intellectual property rights, and on January 4, the White House released its latest annual U.S. Intellectual Property Report, which noted that the Trump administration signed a Phase I trade agreement with the Chinese government that is enforceable against Beijing’s intellectual property violations. However, industry believes that it remains to be seen how Beijing will improve IPR issues in the coming years and whether it will continue to deliver on its promises.
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