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Lei Jun’s Xiaomi Wins 30 Million Yuan Compensation from Shenzhen’s Xiaomi

In a shocking legal battle of Lei Jun’s Xiaomi versus Shenzhen’s Trading Co, Ltd, the outcome favors Lei Jun. It is important to note that these two are different companies, the latter being a Shenzhen-based company operating under brand’s name. However, it is not related to the original brand registered in April 2011 under trademark No. 8228211.

Xiaomi Xiaomi news Xiaomi shock Chinese smartphone maker Lei Jun

So, Shenzhen company applied for the trademark after Lei Jun and managed to gain profits because of the brand’s nametag. Many other merchants and criminals also use similar Mi trademarks, causing significant goodwill loss to Lei Jun’s brand, established in 2010.

Xiaomi Xiaomi news Xiaomi shock Chinese smartphone maker Lei Jun

How did the Xiaomi legal battle start?

It was on December 31st, 2021, when the People’s Court adjudicated the trademark infringement case. As decided by the court, the plaintiff is Xiaomi Technology Company Limited, represented by Lei Jun. It is a famous Chinese smartphone maker established in March 2010. The Shenzhen Trading Company Limited is the defendant represented by Zhu Lingping and launched in December 2012. The finale of this case was a judgment for Shenzhen-based company to compensate Lei Jun’s company with 30 million Chinese Yuan.

Xiaomi Xiaomi news Xiaomi shock Chinese smartphone maker Lei Jun

Is it a conflict inside the company?

The world-famous Chinese smartphone maker brand is owned by Lei Jun. It was founded in 2010 and applied for its brand name and trademark number 8228211 registration in April 2011. However, Shenzhen’s Trading Co, Ltd was registered after and operated under the banner of Xiaomi. People buy Mi products from many offline and online stores besides phones. But they don’t know from which company they are buying. The products include vacuums, massagers, lights, chargers, accessories, etc.

Xiaomi Xiaomi news Xiaomi shock Chinese smartphone maker Lei Jun

For example, the Xiaomi Digital Store on Tmall sells Shenzhen Trading Co Ltd products, including all 182 products like fans, chargers, mobile power supplies, and others. Many buyers think it is Lei Jun’s store franchise and thus buy without hesitation. It is how Shenzhen Trading Company Limited made a lot of money over the years.

Xiaomi Xiaomi news Xiaomi shock Chinese smartphone maker Lei Jun

How did the court reach the compensation verdict?

The court determined the total value of the 182 products sold under Xiaomi’s name by Shenzhen Trading Co, Ltd, which amounts to 154 million yuan. There were a total of 114 products that were infringing the brand’s name trademark and are valued at 135 million yuan. Looking at the Shenzhen company’s 30.78% gross profit ratio, the profit for just three years amounted to 41.55 million yuan. It will amount to an even greater value if calculated from 2012. So, it is beacuse of Lei Jun’s company’s influence, Shenzhen Trading Co, Ltd earned such profits, and the court decided on a 30 million yuan compensation. Shenzhen company paid without any appeal.

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One Comment

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