I. Core Facts: The 15-Million-Yuan Claim Reduced to Zero

On May 27, 2026, the Jiangsu Provincial High People's Court issued its second-instance judgment (Case No. (2024) Su Min Zhong 665) in the unfair competition dispute brought by Crocs Trading (Shanghai) Co., Ltd. against Shanghai Hotwind Fashion Enterprise Development Group Co., Ltd. and five other defendants. The court overturned the first-instance ruling and dismissed all of Crocs' claims. From a finding of infringement and an award of 2.5 million yuan at first instance to a complete dismissal on appeal, this three-year intellectual property battle ended with a dramatic reversal.

II. Case Background: The Trade Dress Dispute Over Clogs

The plaintiff, Crocs Trading (Shanghai), is authorized by Crocs, Inc. to use the "Crocs / 卡骆驰" brand and related intellectual property in mainland China. In October 2022, Crocs sued Hotwind in the Suzhou Intermediate People's Court, alleging that 20 styles of clogs sold by Hotwind closely resembled the appearance of five of its own products: the "Classic Clog," "Little Whale," "Duet," "Warm Cotton," and "Fluffy Warm Cotton," thereby constituting unfair competition.

Crocs distilled the trade dress of the shoes at issue into three core features: a wide, rounded toe; evenly spaced circular perforations across the upper; and an adjustable strap at the heel that can move freely forward and backward, with a round button at the point where the strap meets the shoe body. On this basis, Crocs sought an injunction, 15 million yuan in damages and reasonable expenses, and a public notice to eliminate the adverse impact.

III. The First-Instance Judgment: Infringement Found

In September 2023, the court of first instance found that the "CROCS / 卡骆驰" brand clogs enjoyed substantial market recognition and that the composite trade dress defined by the three core features constituted "trade dress with a certain degree of influence" as a whole. Since the accused products shared those three features, Hotwind's conduct was held to constitute unfair competition. On damages, however, the court found Crocs' presumptive calculation method lacked sufficient support and, in its discretion, ordered the Hotwind entities to jointly pay 2.5 million yuan in economic losses and reasonable enforcement costs.

Both parties appealed to the Jiangsu Provincial High People's Court.

IV. The Second-Instance Reversal: Brand Fame Is Not Trade Dress Fame

The appellate court focused on whether the product shapes at issue qualified as "trade dress with a certain degree of influence" under Article 6 of the Anti-Unfair Competition Law (the 2019 amendment, in effect at the time of the alleged conduct).

The court stated that for product shapes to receive protection under the Anti-Unfair Competition Law, the rights holder must prove that, at the time of the alleged infringement, the shapes themselves had acquired sufficient market influence and had formed a stable association in the minds of relevant consumers with the rights holder, capable of identifying the source of the goods. It must also be established that the shapes are not functional or generic.

After reviewing the evidence item by item, the appellate court made the following findings:

First, insufficient advertising. Before April 2021, Crocs' promotions were predominantly text-based and rarely highlighted the five specific shapes at issue. Although a limited number of online images featuring the shapes appeared after 2015, they were few in number and narrow in reach; meanwhile, a large volume of promotions featured completely different Crocs shoe designs during the same period.

Second, sales data did not correspond to the specific shapes. Financial statements only reflected the company's overall revenue without isolating the sales of the five shoe styles at issue. Store counts and Tmall rankings merely evidenced the brand's overall recognition, not the market influence of the particular shapes.

Third, the trade dress itself might possess technical functionality. According to public statements by senior Crocs executives, the shapes at issue were originally designed to "reduce weight, enhance breathability, and secure the foot" — features necessitated by technical purposes.

Fourth, enforcement records did not corroborate the trade dress's reputation. Most of the enforcement evidence Crocs submitted concerned trademark infringement. Only two matters involved trade dress protection, both initiated after April 2021.

Based on these reasons, the appellate court concluded: the promotional, sales, and enforcement evidence submitted by Crocs reflected the overall reputation of the "CROCS / 卡骆驰" brand rather than the independent recognition and source-identifying function of the five specific clog shapes. The CROCS brand encompassed numerous shoe designs, and Crocs' evidence fell short of proving that, at the time of the alleged infringement, products bearing the five trade dresses at issue had acquired sufficient market influence to form a stable source-identifying association in consumer perception. Accordingly, the appellate court reversed the first-instance judgment and dismissed all of Crocs' claims.

V. Implications of the Case

This case stands in sharp contrast to the "Casio Reissue Watch Case." In Casio, the court found that the GA-110 watch's trade dress had acquired independent market influence — separate from patent rights — through prolonged use, and therefore warranted protection under the Anti-Unfair Competition Law. In Crocs, by contrast, the court held that overall brand recognition cannot substitute for the independent recognition of a specific product's trade dress, and that functional designs are difficult to protect under the Anti-Unfair Competition Law.

Implication 1: Brand fame is not trade dress fame. When asserting trade dress protection, a business cannot rely solely on overall brand recognition or generalized sales data. It must present sufficient evidence that the trade dress itself has independently acquired market influence and a source-identifying function.

Implication 2: Functional designs are difficult to protect under the Anti-Unfair Competition Law. If a product's shape is primarily driven by technical functions, it is unlikely to qualify as protected trade dress — even if prolonged use has generated some degree of distinctiveness — especially for products with limited design space, such as footwear, where shapes serving technical functions (e.g., breathability, lightness) rarely obtain exclusive protection.

Implication 3: Judicial protection returns to the essence of "source identification." The underlying rationale of trade dress protection under the Anti-Unfair Competition Law is neither to safeguard visual aesthetics nor to prohibit industry-wide stylistic borrowing. Rather, it protects the stable commercial association built in the market over time — the ability of consumers to precisely and consistently link a specific combination of appearance features to a particular business. The recognition of a product's shape must be directly tied to its actual use; overall brand reputation cannot substitute for the market perception of a specific trade dress.