Should Infringement of an Unused Registered Trademark Under Three Years Old Be Compensated?

WISECODE Take

Many wrongly assume that using a registered trademark that hasn't been actively used shields them from compensation as long as they claim 'three years of non-use'. The SECRET LAB trademark infringement case handled by the Shanghai Changning District People's Court dispels this misconception. The court clarified that under Article 64, Paragraph 1 of the Trademark Law, the defense of non-compensation for three years of non-use requires the trademark to have been registered for a full three years. In this case, the plaintiff registered the 'Secret Lab' trademark under Class 20 in May 2019, while the defendant opened a flagship store selling gaming chairs in July 2020; since the registration was under three years old, the defendant could not claim immunity. This means that even if a business has not yet launched sales after registration, it retains full exclusive rights during the statutory three-year window, preventing infringers from using non-use as an excuse. For businesses planning ahead, trademark monitoring helps intercept risks when competitors launch similar products. Honest businesses conducting thorough prior searches will remain unaffected. We offer two suggestions: First, perform trademark searches across identical and similar classes before product launches to avoid marks registered within three years. Second, if a registered mark is currently unused by its owner, do not preemptively launch infringing products, as courts will still hold infringers liable. While non-use may reduce the final damages amount, it is never a safe harbor for infringement.