1 July, 2008 – Groupe Danone has lodged an appeal against the Chinese authority's ruling in favour of Hangzhou Wahaha Group in the latest round of the legal battle over trademark ownership.
The French dairy giant launched the appeal following the Chinese arbitration commission’s decision last December involving the disputed Wahaha trademark that was part of a joint venture dating back to 1996 between Danone and Hangzhou Wahaha Group.
Danone has reportedly appealed on the grounds that the commission was in error when ruling the transfer of the trademark from Hangzhou Wahaha Group to the joint venture had been terminated.
The dispute over the ownership of the trademark began in April 2007, with Danone accusing Wahaha founder Zong Qinghou of building parallel businesses to sell the same products as those made by the companies involved in the joint venture.
The two sides had agreed to begin negotiations following the commission’s decision.
A lawyer for Danone said the company could continue using the Wahaha trademark even if it lost its appeal because it had signed an addition trademark contract with Wahaha in 1999.
The lawyer was quoted as saying: “Our case only affects the joint venture's right to own the Wahaha trademark. The joint venture can continue to use the trademark even if Danone is defeated at the appeal level.”
Negotiations between the two parties are still in progress despite the appeal, it is reported.
It is believed three options are being discussed; Danone purchasing Wahaha’s 49% of the joint venture, Danone selling its 51% stake to Wahaha or merging the partnership with companies run by Zong. At present, the talks are focussing on valuations, a person familiar with the situation said.