Lego Wins Ip In China

LEGO sees off another copycat with intellectual property win

They say imitation is the highest form of flattery, but in the world of business, it’s far from it. Lego has had to contend with countless copycat products in the past, with the Danish manufacturer having seen off many of them successfully in court. It’s not been a clean run of wins though, with so-called ‘Lego clones’ promoting themselves as compatible with the genuine bricks a particular thorn in the side of the toy giant.

However, Lego can celebrate as this latest episode in the endless war on intellectual property infringement draws to a close. The case in question involves Chinese manufacturers, operating under the LEPIN brand. The companies involved were not only accused of copying the design of the iconic Lego brick itself, but also items from the long-running Lego Minifigures theme.

Guangzhou Yeuxiu District Court was firm in its ruling, demanding that four defendants named in the case cease production on the suspect products with immediate effect. Further sale and promotion of products under the LEPIN brand is also prohibited. A statement published by Lego on November 5, 2018 also revealed that the court demanded that the defendants in question pay a combined 4.5 million yuan (£500,000) in damages.

This might seem like small change to a global success story like Lego, but the Danish manufacturer has a precedent for aggressively pursuing risks to its intellectual property and infringement. What’s more, the Chinese market represents massive profit potential for the toy company. This latest episode in Chinese courtrooms is only one of several that Lego has found itself entangled in recently.

In 2017, the manufacturer chalked up two legal wins in China that further secured its intellectual property and future market share in the territory. In one such case, the Beijing Higher Court delivered good news to the toy giant by ruling that the Lego logo, as well as alternative names in its Chinese branding, were recognised and established trademarks. This ruling then allowed Lego more freedom in challenging any instances of infringement against its brand and product trademarks.

Later in the year, Lego faced its first actual copyright infringement case in China, with the court again ruling in favour of the manufacturer. In this case, the China Shantou Intermediate People’s Court passed a ruling against Bela, a company that had been found to be manufacturing toys nearly identical to products from the Lego Friends range. Both the products themselves and the design of the product packaging had been called into question, with the ruling declaring that manufacture and sale of these products constituted unfair competition in accordance with Chinese law.

With reduced spending in Europe and North America, these courtroom victories vital for Lego to capitalise on the revenue potential the Chinese market offers. The toy industry alone is worth more than £30 billion, with the building bricks having proved popular with Chinese youngsters and collectors so far. These imitators might seem small fry, but when long-term sales and growth within such a mammoth market are on the table, such rulings are essential.