Infringement Case: Shaolin Temple And SEMA Clothing Have Launched Legal Action

Shaolin Temple, an ancient temple in Central China, once again entered the public view because of a joint infringement of Guochao clothing. The party accused of infringement is the A-share listed company SEMAR clothing (002563).

In the morning of September 2, the reporter of securities times · e company learned from Henan Shaolin Intangible Assets Management Co., Ltd. that, as the only intellectual property management organization of Shaolin Temple in Songshan, China, the company had no communication with Senma company in many ways before, and had carried out legal action.

Is Shaolin's statement true? How will SEMAR deal with related products? Will this incident affect the development of CO branded products? In this regard, the securities times · e company sent an interview letter to SEMAR clothing, but up to the press, no reply has been received.

Joint name Guochao clothing accused of infringement

"Guochao" and "joint name" are undoubtedly the popular trends in the clothing industry in recent two years. Based on the influence of IP, clothing brands can often attract consumer groups by means of CO branding to achieve the marketing effect of one plus one greater than two.

As a typical example of the clothing store of kaws, which was sold in June of 2019, it was a very successful case that kaws and its stores were sold well. In recent years, Samma clothing, which once put forward the slogan of "learning from UNIQLO", also has a lot of product layout in joint brand clothing in recent years.

As one of the cross-border co branded products, around August 2020, SEMAR brand launched a series of CO branded products with Shaolin Kungfu. Recently, however, Shaolin, the co named party, said that it had no knowledge of it.

According to a statement sent by Henan Shaolin Intangible Assets Management Co., Ltd. to the reporter of securities times · e company, as the only intellectual property management organization of Shaolin Temple in Songshan, China, the company received complaints in the early stage, such as the offline physical stores of SEMAR Semir, the "official flagship store of SEMAR" of tmall, the wechat app "the official flagship store of SEMAR", and the "SEMAR brand store" of pinduoduo, And Taobao, pinduoduo and many other stores are selling "Semir Guochao cross border cooperation Guochao Shaolin Kungfu Senma" series of clothing, and use "Shaolin Kung Fu" for clothing labels and commodity names without authorization.

The statement pointed out that the company had never submitted its intention in writing to Shaolin Temple in advance, and the Shaolin side had no idea about it. After receiving social complaints, SEMAR has taken the initiative to take the infringement clothing off the shelves of relevant online platforms. The Shaolin side took the initiative to contact Senma company to participate in the research and development of Shaolin Kungfu in an orderly and standardized way, but the company repeatedly returned the Shaolin Party's notification letter and refused to communicate with it. Recently, it was found that the company still insisted on its own opinions and re sold the above-mentioned infringing clothing in online stores and physical stores on various platforms.

Tianyan investigation shows that the business scope of Henan Shaolin Intangible Assets Management Co., Ltd. includes the management of Shaolin and Shaolin Temple's own intangible assets. The company's major shareholder is Shi Yongxin, abbot of Shaolin Temple. The above statement was also published on the official website of Shaolin Temple on September 1.

In the morning of September 2, a reporter from securities times · e company searched the official flagship store of SEMA tmall and found that there were still products with "shaolink on GfU" printing in the store, and it showed "delivery from stores".

In the wechat app "Samma's official palm flagship store", short sleeve T-shirts, vests and casual pants of "Shaolin Kungfu series" are still on sale.

It is understood that the Shaolin Temple has entrusted a lawyer to communicate with Senma about the infringement for more than one month, but has not received a reply at present.

The statement issued by Henan Shaolin Intangible Assets Management Co., Ltd. also said that, without the authorization of Shaolin Temple and the company, Senma company used "Shaolin Kung Fu" trademark on its own clothing goods and advertising, which has constituted an infringement on the intellectual property rights of Shaolin Temple; Senma company designed, produced and sold the so-called "Senma × Shaolin Kung Fu" joint brand clothing In order to make consumers mistakenly think that the above-mentioned clothing products are authorized joint brand products of Shaolin Temple, or have specific contact with Shaolin Temple and relevant cooperative units, which has constituted unfair competition behavior; the company has entrusted law firms to carry out relevant legal actions, and will reserve the right to investigate the infringer's legal liability according to the affected situation.

Brand marketing needs to break through and inventory pressure remains

After the "golden decade" of China's apparel retail industry from 2000 to 2010, the "traditional fashion brands" represented by SEMAR and metsbawi are facing the market share grabbing by foreign clothing enterprises represented by UNIQLO, Zara and H & M. the industry has entered the competition era of brand retailer transformation.

In this context, CO branding has become the marketing focus of many brands including SEMAR.

In the record of investor relations activities announced by SEMAR clothing on August 27, the company said that in July this year, SEMAR signed up with the opinion leader in the field of e-sports, funplus Phoenix E-sports club, launched a brand-new brand campaign, which encouraged young people to be confident, fearless of difficulties and move towards success. With the signing of the contract, SEMAR began to further socialize with "new youth of generation Z" through various co branded products and brand wide activities, thus opening a new chapter of brand innovation.

According to the reporter of stock times · e company, the flagship store of SEMA clothing and tmall, the co branded series currently on sale include toy story, Donald Duck, Doraemon, Hua Mulan, etc.

It is not known whether the infringement events of Senma and Shaolin will have an impact on the promotion of brand reform of the company. However, the outstanding problems faced by the clothing industry, such as performance decline and inventory pressure, still need to be broken.

According to the semiannual report of 2020 disclosed by SEMAR apparel, the company realized operating revenue of about 5.734 billion yuan, a decrease of 30.24% compared with the same period of last year; the net profit attributable to shareholders of listed company was 22 million yuan, with a year-on-year decrease of 97.01%.

According to the company, in the first half of 2020, the new crown pneumonia epidemic broke out in the world, the world economic development was under great pressure, and the domestic retail industry and clothing industry were impacted and adversely affected. In the face of the epidemic situation, the company reduces the inventory risk by calling off some orders in the flexible supply chain, opening orders in waves and placing futures orders. At the same time, it supplements the retail demand through the fast reaction products of the flexible supply chain.

However, it is disclosed that as of June 30, 2020, the company's inventory amount is still 3.957 billion yuan, showing a continuous improvement effect compared with the inventory of 4.018 billion yuan in the first quarter of 2020, the inventory of 4.109 billion yuan at the end of 2019, and the inventory of 4.2 billion yuan in the middle of 2019.

In the context of the epidemic, the company, based on the concept of harmony and win-win, has increased the proportion of returned goods in its business policy for franchisees, allowing the company to undertake more inventory in the system. The ordering proportion of franchisees has been reduced to a certain extent, and the inventory pressure of franchisees has been reduced. With the recovery of market economy and the release of consumer demand, the ordering ability of franchisees will be improved, which lays a good foundation for the future development of the company.

The company also stressed that the focus of work at this stage is to aim at future market opportunities, research and development of new products, in order to meet the multiple needs of consumers.