Heaven Gifts Trademark Rejection: Brand Challenges Faced by Chinese E-cig Companies

Recently, 2FIRSTS found through a search on the China Trademark website that the trademark "ELFBAR" applied for by Heaven Gifts (Shenzhen) Technology Co., Ltd. has been rejected. According to the trademark process status, the trademark was applied for registration on May 9, 2023, and was rejected on February 24, 2024.

In response to this matter, ELFBAR stated to 2FIRSTS that the rejection was due to a large number of trademarks imitating and plagiarizing ELFBAR on the market. ELFBAR has taken legal action, claiming that the trademark will eventually be approved for registration. However, 2FIRSTS interviewed practicing Counsellor Tang Shunliang, who has extensive experience in both new tobacco and intellectual property fields, who expressed doubts about whether the registration process would be smooth. He told 2FIRSTS that the trademark registration for ELFBAR in China was "not optimistic" for Heaven Gifts.

Overdue "Bill"

Counsellor Tang Shunliang told 2FIRSTS that the trademark dispute encountered by Heaven Gifts was caused by errors in trademark registration both domestically and internationally. The trademark registration errors of Heaven Gifts have also occurred in foreign markets. In the United States, ELFBAR has also been involved in trademark disputes, but as the defendant brand.

In July 2021, the United States Patent and Trademark Office rejected the registration of the "ELFBAR" trademark in the United States due to its similarity to the "ELF" brand under VPR, which was submitted in November 2017 and approved in May 2018. In February 2023, the U.S. District Court for the Southern District of Florida issued a judgment approving the plaintiff VPR Brands LP's "Motion for Preliminary Injunction [ECF No. 5]" and denying the defendants such as Shenzhen Vapeonly Technology Co., Ltd.'s motion for rehearing. In accordance with the judge's order, Shenzhen Vapeonly Technology Co., Ltd. is to cease all marketing activities of its "ELFBAR" brand e-cigarette in the United States.

A series of domestic and foreign trademark registration mistakes have led to the current difficulties faced by Heaven Gifts, and this is not an isolated case. Many Chinese e-cigarette brands are experiencing this round of legal crises due to a large number of domestic e-cigarette factories that simply focused on making money in the early stages of business development through "OEM processing" instead of building a strong brand. They aimed for quantity over quality, hoping to create a few popular products in their massive product lines, and cover their sunk costs with the high profits from these popular products, deeming it a commercial success.

However, ignoring the consequences of initial investment is now resulting in a delayed "bill." Counsellor Tang Shunliang told 2FIRSTS that Heaven Gifts is experiencing the inevitable pains of Chinese manufacturers transitioning from OEM to branding. This mistake in domestic and international trademark registration will force domestic manufacturers to hand over their initiative, especially to overseas distributors, causing high legal costs in terms of time and money. Furthermore, the trademark registration that Heaven Gifts hopes to achieve may not be approved.

How to eliminate risks from the very beginning of brand creation, perfect and maintain the "moat" of overseas trademarks, and minimize the impact from external speculators. This will be a topic that Heaven Gifts and other e-cigarette companies and brands planning for growth and international expansion need to research.

Several Chinese Companies Registered Trademarks Containing "ELFBAR"

According to public information, 2FIRSTS has conducted an overview of other companies that are also associated with the "ELFBAR" trademark. (The images in the following text are all from the China Trademark Website unless otherwise specified)

In the database available for search on the Chinese Trademark website, there are 59 trademarks submitted for registration based on "ELFBAR", all of which are registered by commercial entities other than Heaven Gifts Technology Co., Ltd. There are 6 different business entities that registered these trademarks, all occurring between the years 2022 and 2023.

Rakabunila Wholesale was the first to register the trademark "ELFBAR USA" in August 2022. The entity is not listed in mainstream public databases such as Tianyancha, but has applied for multiple trademarks under the international classification "34 Tobacco and Tobacco Accessories," including well-known brands like FLUM.

Disike (Dongguan) Electronic Technology Co., Ltd. later registered a similar "ELFBARUSA" trademark at the end of September 2022, with slightly different font colors and no space between the two words. However, it has no business connection with Heaven Gifts. During a previous investigation into the underground e-cigarette market in Hong Kong, one of the products purchased by 2FIRSTS was identified as being produced by this company, with the packaging not passing anti-counterfeiting verification. The company also has several trademarks registered that are similar to well-known brands.

Shenzhen VapeEra Technology Co., Ltd. recently registered the trademark "ELFBAR ORIGINAL" in October 2022, with the intention of conveying the meaning of "original ELFBAR". According to public records, the company was established in 2016 with a subscribed capital of 5 million yuan. Its main office is located in Bao'an District, Shenzhen, and it operates in the e-commerce industry, specializing in e-cigarettes and electronic vaporization devices. However, it has no business relationship with Heaven Gifts.

Dongguan Yizhidong Technology Co., Ltd. also registered the trademark "ELFBARCN" in October 2022. The company was established in 2020 and is based in Humen Town, Dongguan City, Guangdong Province. Its business scope includes research and development, production, and sales of e-cigarettes and accessories (excluding online sales), but public records do not show any business overlap with Heaven Gifts.

In the same year, earlier in July, it registered multiple trademarks related to "Love 96" and "LOVE96" associated with smoking products. Currently, there are no products available in the market with these trademarks, but products like LAFI 6500 PUFFS include flavor names with the same title.

Shenzhen Haibo Atomization Technology Co., Ltd. registered two trademarks named "ELFBAR CLOUDS" on the same day in April 2022. However, public information does not show any business overlap with Heaven Gifts. The company also has registered similar trademarks related to ELUX. Its licensed business activities include import and export of goods, and its registered customs operation category is also for import and export goods transportation.

Dora International Limited was newly established in April 2023 and registered the "ELFBAR GOLD BAR" in the same year in August. However, public records do not show any business connection with Heaven Gifts. Within less than a year of its establishment, the company has intensively applied for multiple trademarks involving well-known brands, including CRYSTAL BAR in addition to ELFBAR.

All six registered entities are involved in the new tobacco business, but most of them do not have direct relationships with Heaven Gifts in terms of subcontracting or other upstream and downstream appointments. These trademarks have caused obstacles in the domestic trademark registration process of ELFBAR, and have also partially led to the problem of non-compliant products bearing the name "ELFBAR" flooding the US market. Furthermore, the trademarks registered under these companies also involve other well-known brands besides just ELFBAR.

2FIRSTS will continue to track cases of trademark squatting and infringement.