In response to the Hangzhou Intermediate People's Court ruling in favor of Wahaha's right to its trademark, Danone Group yesterday said it will pursue all legal options to protect its contractual rights and financial interests.

Wahaha spokesman Shan Qining said: "What we want to say to Danone's statement is only one sentence: 'We respect the decision of the court and we respect the law.'"

Hangzhou-based Wahaha Group had earlier said the Hangzhou Intermediate People's Court had rejected Danone's appeal of Hangzhou arbitration commission's ruling in favor of Wahaha in a dispute over the ownership of the Wahaha trademark.

The Wahaha spokesman said the ruling was a key development in its prolonged dispute with its French partner, and should have a positive impact on another dispute that is now before an arbitration commission.

Danone Group argued that the Hangzhou arbitration commission's ruling had "distorted the facts of the case, intentionally and maliciously misinterpreted and misapplied the laws of the People's Republic of China, and was an award that completely ignored the facts and law".

Danone had also said it hoped the Hangzhou court would carry out the substantive review, apart from the procedural review, of the legality of the arbitral procedures.

In its latest statement, Danone said: "The Hangzhou court only carried out a procedural review for this case (specifically, the Hangzhou court failed to conduct a substantive review of the accuracy and legality of the determination of facts and application of law) and rendered its ruling based on a procedural review only."

Although the Hangzhou court ruling is final, Danone said it would report the matter to the appropriate superior judicial authorities in China. It also said the arbitration proceedings in Stockholm would begin hearing in January.

Last year, Danone filed its first lawsuit against Wahaha on May 9 in Stockholm, and on June 4, Danone filed another lawsuit in Los Angeles against two Wahaha-related companies and two individuals.

Since 2006, the two companies have filed numerous complaints and lawsuits against each other under various Chinese and foreign jurisdictions.

Danone, which owns a 51 percent stake in 39 Danone-Wahaha joint ventures, has accused Wahaha of setting up independent companies and selling products identical to those sold by the joint ventures. Danone had demanded a 51 percent stake in the non-joint-venture companies, which Wahaha rejected.

(China Daily August 6, 2008)