New Balance Wins Landmark Lawsuit in China Against Counterfeit Brand

Global athletic footwear leader New Balance Athletic Shoe, Inc. announced today that it had won a significant trademark infringement lawsuit in China against Chinese footwear maker Qiuzhi Footwear. The court awarded New Balance a monetary award of 600,000 RMB (USD $75,000) and ordered Qiuzhi to stop producing its “New Barlun” athletic shoes.
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BOSTON – Global athletic footwear leader New Balance Athletic Shoe, Inc. announced today that it had won a significant trademark infringement lawsuit in China against Chinese footwear maker Qiuzhi Footwear. The court awarded New Balance a monetary award of 600,000 RMB (USD $75,000) and ordered Qiuzhi to stop producing its “New Barlun”
athletic shoes.

“Billions of dollars worth of counterfeit brand-name goods are discovered annually around the world, most of them originating in China,” says Ed Haddad, vice president of Intellectual Property and Licensing at New Balance. “Brand owners must be vigilant against those who would capitalize on their goodwill and brand reputation. We applaud the Court's actions as a tremendous breakthrough in IP protection in China.”

In 2002, New Balance discovered a group advertising itself as “American New Barlun (Hong Kong) Limited” conducting business in China and promoting a relationship with the “American New Balance” company. New Barlun (which when spoken quickly sounds much like New Balance) had acquired trademarks which were similar to those of New Balance and combined them with packaging, advertising, and slogans also similar to the brand. New Barlun began selling franchises and opening retail stores throughout China. New Balance took immediate action, working with China's Administration for Industry and Commerce (AIC) with limited success.

In 2003, New Balance discovered that New Barlun was a front established in Hong Kong by a Chinese company called Qiuzhi Footwear. New Balance then sued Qiuzhi in the court of Hangzhou. Harley Lewin, of Greenberg Traurig LLP, coordinated the legal battle on behalf of New Balance.

After almost three years of litigation, the Court agreed with New Balance's arguments and found Qiuzhi liable to New Balance for trademark infringement and unfair competition. The Court agreed that New Balance's use of an “N”
logo on footwear is particularly connected to New Balance products, and that although Qiuzhi owned a similar trademark, their use of an “N” was confusing and deceptive to consumers. The Court also agreed that Qiuzhi's use of the name “New Barlun” infringed on the New Balance trademark.

“New Balance fights very hard to protect itself and the brand's reputation around the world so the results of the Court's action are especially gratifying” says Haddad. “While this is a specific victory for New Balance, it is also a victory for all companies who fight counterfeiters. The Court was not fooled by the pretense of Qiuzhi's claims and had the courage to expose those who would seek loopholes to justify their actions.”

New Balance, headquartered in Boston, MA, is a leading manufacturer of technologically innovative width-sized performance footwear and athletic apparel for women, men, and children. The range of product categories includes running, walking, training, basketball, tennis, cleated and kids.
New Balance employs more than 2,800 people around the globe, and in 2005 reported worldwide sales of $1.54 billion. For more information please visit http://www.newbalance.com
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Amy Vreeland
Corporate Public Relations Manager
New Balance Athletic Shoe, Inc.
617/746-2214; 617/787-9355 fax
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