First-Instance Verdict Delivered in Huiyuan Trademark Infringement and Unfair Competition Lawsuit with 97 Million RMB Damages

WISECODE Take

When OEM cooperation ends, continuing to use licensed trademarks is often mistaken as a simple breach of contract, but it actually constitutes serious trademark infringement and unfair competition. In a first-instance judgment, Fuzhou Intermediate People's Court ruled in favor of Beijing Huiyuan Food & Beverage Co., Ltd., holding that defendants unlawfully used Trademark No. 1643301 after license termination on January 1, 2025, ordering damages over 97 million RMB and holding the sole shareholder jointly liable. This highlights the necessity of asset clean-up mechanisms when partnerships expire; compliant OEMs operating under valid agreements remain unaffected. Zhidian helps enterprises establish trademark licensing management and monitoring mechanisms to mitigate litigation risks after license expiration. Businesses should take two actionable steps: first, clearly specify termination dates and inventory liquidation periods in OEM contracts; second, sole shareholders of limited liability companies must maintain independent financial accounts and audit records to avoid joint liability. The expiration of a license is not the end of a partnership, but failing to define asset boundaries marks the beginning of corporate liability.