Supermarket copycat ordered to pay over 1.3 million yuan in compensation

Shanghai-based supermarket chain Hualian GMS has won more than 1.3 million yuan (US$206,231) in compensation in an unfair competition lawsuit against a copycat supermarket.

Bailian GMS, according to the Pudong New Area People’s Court, was created as a rip-off of a popular supermarket chain called Hualian GMS, which is run by local retail giant Bailian Group.

The genuine supermarket chain only became aware they had a copycat when a customer who was injured in one of the rip-off stores attempted to sue the real chain for compensation.

They then discovered that everything in the copycat store, from its layout to promotional leaflets, had been copied. 

Hualian GMS sued the copycat and sought compensation.

The rip-off store Bailian GMS, operated by Shanghai Dinggin Trade Co, opened in July 2016. It argued that Bailian GMS was registered as a trademark and that the name didn’t infringe on the rights of Hualian GMS.

According to the court, the genuine GMS brand is well-recognized by locals as a supermarket chain. It was obvious that Bailian GMS took advantage of the name of Hualian GMS and its parent company Bailian so as to mislead customers, which was therefore unfair competition.

On Tuesday, the court upheld the request of Hualian GMS and ordered the copycat to pay 1.326 million yuan in compensation.