Coupang's Measures to Stop Infringing Design Sales

As the online commerce market grows explosively, disputes over intellectual property rights are also increasing. Recently, there has been a sharp increase in cases where sellers face unexpected product sales suspensions due to Coupang's design infringement, resulting in considerable financial and time-related damages. Moreover, Partial Design Review Systemand by abusing the law to register a design right that could render it effectively invalid, using this as a pretext to threaten sellers or demand settlement money, brokerThere are also such cases.

In this column, Coupang design infringement Let's take a deeper look at related issues and examine recent Cases of Abuse of the Partial Design Review Systemand about this Practical Response MeasuresPine IP Firm will guide you through this.

The rapid growth of the online market and Coupang's design infringement issue

1) Expansion of Online Commerce and Intellectual Property Rights Disputes

With platforms like Coupang, Naver Smart Store, 11st, and Gmarket, anyone can easily start a business, and product design, trademarks, patents, and more Intellectual Property Rights Disputes are surging.

• Design Rights: The right to protect the appearance of products (items), and its importance has become increasingly significant as the issue of 'imitation products' continues to arise in the commodity market.
• Due to the nature of online platforms, products with identical or similar designs can spread rapidly, so rights holders actively try to crack down on infringement.

2) Coupang's Intellectual Property Protection Policy

Coupang strongly expresses its commitment to protecting intellectual property rights. If the rights holder (design right holder) files an infringement report, Sales suspension, Stop product exposure, Account Restrictions They take swift measures such as these, which is problematic because sellers are likely to suffer first even before the actual breach is confirmed.

• When rights holder reports are received, Coupang often operates on a 'suspension of sales first, review later' model, which causes sales losses for sellers and severely damages their trust.

Why is the partial design review system abused?

1) Types of Design Review Systems

In Korea, through the design registration examination system, Partial Examination Systemand Full Review Systemcoexist.

• Full Review System: Strict screening of all registration requirements (novelty, creativity, rationality, etc.) is conducted, and only designs that meet the requirements are registered.
• Partial Examination System: For specific items, it does not comprehensively review key registration requirements such as novelty, but only reviews document formats and simple requirements, allowing for relatively faster registration.

2) Purpose and Actual Issues of the Partial Review System

The partial review system was introduced to help companies quickly and easily secure design rights, thereby increasing motivation for product development. However, Some brokersThey exploit this system and use the following tactics.

1. Even designs with clear invalidity reasons can be registered.
   • For example, even if a design has already been announced or is very similar to an existing design, under the partial examination system, the review process is simple and registration may be permitted.
2. Using registered design rights to threaten or demand settlement money
   • No matter how many grounds for invalidation exist, the status of registration alone is legally valid (until the invalidation of registration is finalized).
   • Brokers use this as a pretext to suspend sales through 'Coupang design infringement reports,' then demand deposits or settlement payments or collect royalties (licenses) to make profits.

There has been a steady increase in cases where design rights, which are likely to become effectively invalid, are used as bait to demand unfair settlement fees from numerous online sellers, becoming a social issue.

Coupang's design infringement, the damage sellers suffer

1. Sales and inventory loss: If you were a seller generating major sales on Coupang, the sudden sales suspension will severely impact your sales and make inventory management difficult.
2. Damage to brand image: Brand credibility may decline, such as records of infringement reports or product pages disappearing.
3. Time and Cost Consumption: To resolve a design infringement dispute, consultation with a patent attorney or lawyer is required, and if litigation proceeds, significant time and costs are required.
4. Exposure to unfair settlement demands: Brokers holding design rights acquired through partial review systems that are 'similar or invalid' often use lawsuits as a pretext to demand large settlement sums and pressure sellers.

Strategies of Brokers Exploiting the Partial Design Review System

Recently discovered Broker (brokerage firm) Their typical strategies are as follows.

1. Indiscriminate application
   • Even if designs lack novelty or originality, a partial review system allows for rapid application and registration of large quantities of designs.
   • Targeting high-demand sectors such as clothing, accessories, and daily necessities, we secured similar design rights.
2. Online Platform Monitoring
   • They found popular products on platforms like Coupang, Naver, and Gmarket, claiming that their designs were 'similar to the design rights they registered.'
3. Reporting and instructing sales suspension
   • A design infringement report was filed on Coupang, and the seller's product immediately Pressure is enforced by measures to suspend exposure and suspend sales.
4. Demand for settlement money
   • Contact the seller directly to demand 'compensation,' 'settlement money,' or 'royalties' for the use of the design. Sometimes they present high-value bills to intimidate them and pressure them to settle quickly.

The problem is that these brokers' 'malicious strategies' Distorting the purpose of the partial review systemand, Legitimate Online Business OperationsIt hinders the situation.

A wise response to Coupang's design infringement

1) Objection and Explanation Procedures

Coupang gives sellers the opportunity to explain their case when a report of infringement is filed. At this time Registration number of the counterparty's design rights, Design drawings, Registration Ledger and then systematically prepare the following items.

• Writing a statement of purpose:
  • The design rights for which my product is registered Practical differencesmust be explained logically and visually.
  • You can also present previously known (or public) prior designs to claim that the opposing party's design rights lack novelty.
• Challenge of Design Rights Validity:
  • Check the registration date, maintenance period, and status of the invalidation judgment of the opposing party's rights Grounds for Invalidity(Creative rationality, lack of novelty, etc.) are pointed out.
  • If the reason for invalidity is clear, you can inform Coupang of this fact and make the dispute resolution process more advantageous.

2) Request for Invalidation Trial

The design rights exercised by the other party Acquired through the partial examination systemand if there are sufficient grounds for invalidation, Design invalidation trial at the Intellectual Property TribunalIt is recommended to charge for it.

• If Coupang is notified of the invalidation judgment, there are cases where the suspension is relaxed or lifted during the ongoing dispute.
• If an invalidation trial is granted, the design right will lose its effect retroactively, making it fundamentally impossible to assert infringement.

3) License Agreement or Agreement

If the other party's design rights validAnd if the similarity to my product is likely to be recognized, to avoid unnecessary litigation costs and time, license agreementor agreementYou can review it.

• reasonable range By paying settlements within the market and resolving disputes early, it may be beneficial to resume sales.
• However, if the broker demands excessive conditions, rather than agreeing unconditionally, it is better to seek expert advice. annulment judgment Or Legal responseIt is better to look for it.

Solutions provided by Pine IP Firm

1) Infringement response and explanation agency

• If a Coupang design violation issue arises, Explanatory MaterialsBy professionally preparing and systematically submitting them to Coupang, the likelihood of lifting the sales suspension measures is increased.
• If the other party's design rights are acquired through partial examination and there are grounds for invalidation, a strategy is established to logically prove this.

2) Invalidation Trials and Dispute Resolution

• Invalidation Trials by the Intellectual Property TribunalWe represent you in all intellectual property dispute procedures, including those related to the Emperor.
• If necessary, we will comprehensively review various legal responses such as civil lawsuits and criminal complaints, Optimal solutionis presented.

3) Recurrence prevention consulting

• Necessary to protect design rights Application Strategy, Registration Strategy, Brand Protection Strategy and more.
• Preparing for Similar Design Infringement Reports System(Preliminary investigation, monitoring, response guidelines) to help reduce conflict risks in the long term.

Prompt and professional response is the most important key

Coupang design infringement Issues are expected to become more frequent as the online market grows. Especially recently, Partial Design Review SystemMalicious brokers are increasing by registering design rights with strong invalidity grounds and imposing 'toll fees' on sellers, so extra caution is required.

• Validity of Design RightsThoroughly understanding from the beginning
• Provided by Coupang Calling OpportunityActively utilizing
• annulment judgment Responding to malicious exercise of rights through legal procedures such as

From the seller's perspective, this strategy Sales suspensionIt is the key to keeping your business stable and moving beyond that.

Pine IP Firm, based on extensive experience and specialized knowledge, Customized intellectual property protection and dispute resolution solutions for online commerce sellersProvides it. If Coupang design infringement If you feel embarrassed by the issue, please contact us immediately. Rapid response is the only way to minimize financial and time losses.DesignIt is a crucial asset that protects the ideas of companies and individuals and enhances product competitiveness. Pine IP Firm will stand together to protect your precious design and business opportunities.