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Last year, Michael Jordan finally received a favorable verdict from the Supreme People’s Court in China. The verdict came after a long drawn out legal battle against Qiaodan Sports, a multi- million dollar Chinese sportswear company who was using the Chinese transliteration of Jordan’s name as its registered trademark.
After losing several cases before the lower courts, this victory comes as a huge relief for Jordan as well as many foreign firms doing business in that are similarly plagued by trademark squatters liked Qiaodan.
However, this case goes to show risks of trademark squatting and the rigors of Chinese legal system – even internationally recognized brands like Jordan’s are not safe in China. Other foreign brands – such as Apple, Google, and New Balance – have also faced similar challenges in China and have lost millions of dollars as a consequence.
While foreign businesses have gotten better at understanding how to manage their intellectual property in China, many fail to anticipate local challenges before entering the market.