The product infringement claim was 300,000 US dollars. Cross-border merchants must refuse infringement and comply with regulations.

Not long ago, a card issuing merchant was sued for $300,000 by a foreign lawyer for product infringement . Another clothing merchant reported that he had received three TROs, some products had not been sold at all, and some products were still affected after being off the shelves for a year, and he finally had to pay money to settle.

Most cross-border merchants fear TRO not only because they need to pay compensation, but also because time cost is an important consideration.

As more and more precedents are learned, cross-border merchants are refusing to "step into the trap", and their awareness of compliance with regulations is gradually increasing. At the same time, while preventing infringement on others, some brands are also paying attention to preventing infringement on others.

Recently, the Eastern Division of the United States District Court for the Northern District of Illinois issued two consecutive temporary restraining orders (TROs) against platform sellers who infringed on multiple SHEIN U.S. copyrights, involving a total of 35 sellers. So far, the U.S. court has issued 12 TROs, requiring overseas e-commerce platforms and sellers and other parties involved to stop infringing on the SHEIN brand.

SHEIN, which started out as an independent fashion brand , has formed a unique model of "independent brand + platform" dual-engine development. Its independent brand has an industry-leading "production based on sales" flexible on-demand supply chain model, and through the platform model, it also empowers more third-party merchants and brands in more industries. The influence and popularity of SHEIN's independent brand continues to rise. According to recent media reports, SHEIN has surpassed its national brand UNIQLO in Japan and has become the second largest fashion brand in France, second only to ZARA.

A large number of merchants have fallen into traps, and compliance with regulations is imperative for overseas operations. Compliance with regulations for overseas operations has become a top priority for merchants, because once this issue is ignored, merchants may be badly hit .

In June, the "2024 Survey on Overseas Intellectual Property Disputes of Chinese Enterprises" released by the China Intellectual Property Research Association and the National Overseas Intellectual Property Dispute Response Guidance Center showed that among the 1,762 new intellectual property litigation cases filed and closed by Chinese enterprises in the United States in 2023, 1,092 involved cross-border e-commerce cases, of which 1,033 cases involved Chinese enterprises as defendants, accounting for as high as 94.60%. Among the 774 closed cross-border e-commerce cases, the courts issued TROs in 692 cases.

This year, TROs are even more frequent. "To do overseas business, you need to have a long-term vision and compliance is a prerequisite", "Overseas merchants must be careful to distinguish and not be misled by the platform into infringement traps and finally become the 'scapegoat'", "Prevent infringement on others, and also prevent infringement by others"... These views are becoming the consensus of cross-border merchants.

As leading companies going overseas, top brands need to set an example and lead, and platforms need to lead by example, establish compliant platform rules and ecosystems, and promote more standardized development of the industry.

Taking SHEIN as an example, SHEIN and Guangdong Zhongce Intellectual Property Research Institute launched public welfare training to empower intellectual property. Within three years, they will hold hundreds of public welfare service activities for cross-border merchants through education and training, practical tool development, one-on-one compliance and legal consultation, etc., to help more brands and merchants to comply with intellectual property regulations, protect and innovate in the process of going overseas.

The latest public welfare activity was held in Nanjing. Topics related to promoting healthy and sustainable development of the industry, such as "compliant overseas expansion", "green overseas expansion" and "innovative overseas expansion", became the consensus among the participating cross-border business groups and legal experts.

  ( The latest offline training event of the "Rare Gravitation·Innovation Era" IP Empowerment Program was held in Nanjing)

"We will uphold the city's temperament of openness, cooperation, mutual benefit and win-win, constantly innovate mechanisms and optimize services, and work together with SHEIN to provide more comprehensive and precise support for the majority of cross-border e-commerce companies in establishing IP image, protecting and using intellectual property rights." Tan Yong, deputy director of the Nanjing Municipal Bureau of Commerce, said at the event.

It's not just SHEIN. During the China (Guangzhou) Cross-border E-commerce Fair from August 16 to 18, cross-border companies such as Amazon, Rakuten, coupang, SHEIN and others jointly issued five cross-border e-commerce initiatives, calling on the entire industry to strengthen regulations, protect intellectual property rights, resist unfair competition, and jointly promote the healthy and orderly growth of the industry and continuous standardized development.

When companies "go overseas", compliance must come first. This is the basis of development and the general trend. Cross-border merchants should not ignore overseas intellectual property layout planning and risk warning in order to quickly seize overseas markets. Once they are involved in infringement disputes, they will face penalties such as product removal and fund freezing, which will not only cause high economic losses and damage their own reputation, but may even further lead to costly legal proceedings.

In their overseas business activities, Chinese cross-border e-commerce operators must adhere to the red line of "respecting the intellectual property rights of others" and operating in compliance with regulations. At the same time, merchants must strengthen their own brand building and form innovative product and brand competitiveness in order to avoid homogeneous red ocean competition and build their own advantages and competitiveness in global development.

SHEIN

Product Infringement

Compliance