A court in eastern China's Zhejiang Province has ordered an online shopkeeper to pay his business rival 2.1 million yuan (300,000 U.S. dollars) in damages due to malicious complaints.
The plaintiff, surnamed Wang, runs a sportswear shop on Taobao, the e-commerce retail platform of Alibaba, China's e-commerce giant. In December 2016 Wang was complained on by the defendant, surnamed Jiang, of selling alleged infringing products.
Taobao then deleted the links of the involved products based on evidence provided by Jiang.
In January 2017, Wang lodged a complaint with the intellectual property protection platform of Alibaba and won the appeal and his products links were restored. Jiang filed a counter-appeal later, leading to another round of blocks involving links and punishment of Wang conducted by the IP protection platform for selling infringing products.
However, police investigation eventually found that Jiang sold counterfeit products through making fake official endorsement and product certificates and made complaints against Wang with fabricated evidence and malicious intent.
The Hangzhou Internet Court ruled that Jiang's behavior had resulted in a sharp decline in the sales value of Wang's e-shop. It ordered Jiang to pay compensation to Wang for unfair competition.
"China has made more detailed rules to cope with malicious complaints and unfair competition in accordance with the country's first e-commerce law, which officially took effect this month," said Ye Shengnan, the judge who undertook the case.
Online trading activities will be scrutinized more strictly in line with the new e-commerce law, in order to keep China's e-commerce sector on an orderly track, the judge said.