Trump wins key China trademark; Are Trump toilets a goner?
Banners advertising the high-end Trump-branded toilets made by Shenzhen Trump Industrial Co. are on display at the company's offices in Shenzhen in southern China's Guangdong Province on Feb. 13, 2017. (Mark Schiefelbein/AP)
Erika Kinetz, The Associated Press
Published Tuesday, February 14, 2017 9:11AM EST
Last Updated Tuesday, February 14, 2017 3:26PM EST
SHANGHAI -- There's a Trump toilet, a Trump condom, a Trump pacemaker and even a Trump International Hotel among hundreds of trademarks in China that don't belong to Donald Trump. But after a decade of grinding battle in China's courts, the president is expected to get an unlikely win on Tuesday: the rights to his own name.
Trump's late victory in the fight to wrest back one sliver of his brand -- the trademark for building construction services -- could signal a shift in fortune for the U.S. president's intellectual property in China. At stake are 49 pending trademark applications -- all made during his campaign -- and 77 marks already registered in his name, most of which will come up for renewal during his term. The case also raises the possibility that the president could claw back control of more than 225 Trump-related marks in China that do not belong to him.
To some, it also illustrates how Trump's efforts to consolidate control over his brand could be used to extend or withhold favour, especially in a country like China where the courts and bureaucracy are influenced by the ruling Communist Party and by design reflect the leadership's political imperatives.
Trump's foreign trademarks have raised red flags with ethics lawyers across the political spectrum who say they present grave conflicts of interest and may violate the emoluments clause of the U.S. Constitution, which bars public servants from accepting anything of value from foreign governments unless explicitly approved by Congress.
"There can be no question that it is a terrible idea for Donald Trump to be accepting the registration of these valuable property rights from China while he's a sitting president of the United States," said Norman Eisen, who served as chief White House ethics lawyer for President Barack Obama. "It's fair to conclude that this is an effort to influence Mr. Trump that is relatively inexpensive for the Chinese, potentially very valuable to him, but it could be very costly for the United States."
Richard Painter, chief White House ethics lawyer under President George W. Bush, called the situation "highly improper." Since foreign governments know Trump cares deeply about his family's business, Painter said, "they will give him what he wants and they will expect stuff in return."
Eisen and Painter are involved in a lawsuit alleging that Trump's foreign business ties violate the U.S. Constitution. Trump has dismissed the lawsuit as "totally without merit."
Alan Garten, chief legal officer of The Trump Organization, said the Chinese trademarks were already in the works before the election, and the president has turned management of his company over to his children and a team of executives.
In an email, Garten wrote, "The only mark we were seeking was one in the related class of construction which someone was improperly squatting on."
The precise value of the trademarks is a matter of debate, but Trump himself thought his brands in China were worth enough to defend them, according to a 2011 letter he wrote then-Commerce Secretary Gary Locke about a trademark dispute in Macau, an autonomous region of China.
"I spent hundreds of thousands of dollars in legal fees to secure my own name and globally recognized brand from Chinese individuals who seek to trade off my reputation," Trump wrote.
In May 2009, he dispatched a team with 300 pounds of evidence to prove that Donald Trump was, in fact, famous. It didn't work. Trump railed against the courts as "faithless, corrupt and tainted."
"The Trump name resonates throughout the entire world," Trump wrote. "According to their ignorant council of judges, it appears the only two places in the world I am not well known are China and Macao," he added, using an alternative spelling.
That may be changing.
As president, Trump's elevated profile in China will likely make it easier to protect his brand, said Zhou Dandan, a lawyer with Unitalen Attorneys at Law in Beijing, which has worked for Trump since 2006. Trademark authorities will almost certainly reject new "Trump" applications from unrelated parties, she said, and may take back rights from existing "Trump" trademark holders.
That's what happened in the case nearing completion this week.
Trump applied for rights to the Trump mark for construction services on Dec. 7, 2006, but a man named Dong Wei had filed a similar application about two weeks earlier. China works on a first-come-first-served basis for trademarks, and the Trademark Office rejected Trump's application.
Trump appealed to the Trademark Review and Adjudication Board, then to the Beijing Intermediate People's Court, and finally to the Beijing High People's Court. He lost, lost and lost again.
Separately, he tried to invalidate Dong's trademark, but failed, and failed again on appeal, according to Matthew Dresden, a China intellectual property attorney at Harris Bricken in Seattle, who has studied the case.
The last time courts ruled against Trump in the construction-services case was May 2015, the month before he declared his candidacy.
Then Trump's lawyers simply went back to the Trademark Review and Adjudication Board, which had already rejected their case, and again asked them to invalidate Dong's trademark, Dresden said.
This time it worked. On Sept. 6, 2016, the Trademark Office published its invalidation of Dong's trademark for construction services. Dong could not be reached for comment.
That decision cleared the way for Trump's own claim to move ahead. Trump's mark was published in China's Trademark Gazette on Nov. 13, less than a week after he won the presidential election. Interested parties have three months to object. If no one does, the trademark will be registered to Trump on Tuesday.
Why is Trump winning in China's bureaucracy now, after years of failure? China's State Administration for Industry and Commerce and its foreign ministry did not reply to requests for comment.
Some lawyers point to a general hardening in China's stance on trademark squatting. In January, China's Supreme People's Court released a legal interpretation stipulating that names of "political, economic, cultural, religious, national and other public figures" should not be trademarked. That notice came after a December ruling returned the Chinese version of Michael Jordan's name from Qiaodan Sports Co. to the basketball star. In Mandarin, Qiaodan sounds like Jordan.
Others say politics almost certainly played a role. By 2016, the nature of the dispute had changed. Chinese authorities were now ruling on a case that pitted a guy from Liaoning province against a man running for president of the United States.
"It would be hard to imagine that the judges, the Trademark Office and/or the Trademark Review and Adjudication Board were acting without some kind of guidance," said Dan Plane, a director at Simone IP Services, a Hong Kong intellectual property consultancy.
He added that the outcome of future cases could depend on Trump's relationship with Beijing.
"If there's a clear decision made by an angry Chinese government to stop giving broad protection to the Trump name in China, Trump's ability to defend or enforce his name could be quite limited," Plane said.
Meanwhile, the makers of Trump-branded luxury toilets at Shenzhen Trump Industrial Co. face a potent new potential adversary. They say they will defend their brand, even if it means taking on the U.S. president.
Co-founder Zhong Jiye said his Trump toilet, which dates to 2002, has nothing to do with President Trump. The Chinese name brings together ideas of innovation and popularity, he explained. And in English, the "U" makes a nice toilet-seat shape logo.
Trump toilets for the home can do pregnancy tests, while models for public use have disposable seat covers for improved hygiene. The company says sales were up more than 50 per cent last year and an international expansion is in the works -- perhaps under a different brand now that Trump is president.
People use Trump toilets some 100 million times a year, Zhong said.
Among them, he added, are customers at Zhongnanhai, the official residence of Chinese President Xi Jinping.
Associated Press researcher Fu Ting contributed from Shanghai.