Italian espresso machine manufacturer Cimbali Group has won a “milestone” lawsuit in China for unfair competition.
The lawsuit, via Cimbali Group’s subsidiary Seattle Espresso Machine Corporation, has resulted in four Chinese companies being sanctioned by a Shanghai Court of First Instance.
The Chinese civil court recognised that the four Chinese companies were producing and marketing coffee machines that closely resembled the Slayer Espresso model, with distinctive design and packaging elements replicated on the machines.
The company claimed this led to consumer confusion between the original Slayer Espresso coffee machine and the one produced and marketed by the counterfeit Chinese companies, creating an unfair competitive advantage to the detriment of Cimbali Group.
The Shanghai judges recognised the design of the Slayer coffee machine as “influential” under Article 6 of China’s Unfair Competition Law. The four Chinese companies were ordered to immediately cease the production and marketing of machines as well as pay damages and legal fees.
In China, cases in which a foreign company succeeds in obtaining a favourable ruling against unfair competition from Chinese companies are said to be extremely rare. Although this is a first-instance ruling subject to appeal, the decision of the Shanghai Court is said to be significant given the complexity of the Chinese legal context.
Cimbali Group believes the recognition of legal protection for a business-to-business product is the first, and currently only, successful case in the coffee equipment sector, which has seen several instances of counterfeiting in recent years.
