Even after they vowed to call a truce in their public war of words last year and concentrate on developing better products, two famed Chinese herbal tea makers have again locked horns in a legal battle.

Guangzhou Pharmaceutical Holdings, best known for making Wong Lo Kat herbal tea, announced last week that it prevailed over Hong Kongbased JDB in their most recent dispute, this time over advertising slogans, Beijing Business Daily reported.

Chongqing No 5 Intermediate People's Court ordered JDB to pay Guangzhou Pharmaceutical more than 800,000 yuan ($129,990) in compensation for false advertising and directed it to stop using misleading slogans.

The lawsuit filed by Guangzhou Pharmaceutical mainly focused on an advertising slogan that contended that "of every 10 bottles of herbal tea sold in China, seven are from JDB".

The plaintiff accused JDB of unfair competition, alleging the advertising easily misled consumers into thinking that JDB has 70 percent of China's herbal tea market.

The Guangzhou company also disputed other claims made in JDB advertising.

Feng Zhimin, office director at JDB, said the judgment was "unfair" because the advertising was "all based on facts and supported by market statistics".

JDB would appeal to a higher court, Feng said.

A source close to JDB told the Beijing business newspaper that the company had already gradually reduced the use of the controversial ad slogans.

"The court verdict has little effect on JDB's marketing strategy," the source said.

But Zhu Danpeng, a researcher with 21food.cn, a website providing food sales information, said the court decision will weaken the company's brand promotion because its new slogan - "JDB leads the domestic herbal tea market in sales volume" - has a "weaker impact on audiences".

Many industry insiders agreed that the court victory by Guangzhou Pharmaceutical will not directly increase sales.

Xu Xiongjun, a marketing expert in the food and beverage industry, said JDB had better market performance than Wong Lo Kat last year and also has better marketing and distribution channels.

Guangzhou Pharmaceutical and Hong Kong JDB have made headlines many times since 2011, when the mainland company filed an application with the China International Economic and Trade Arbitration Commission against JDB, asking it to stop using the trademark Wong Lo Kat.

JDB had been using the Wong Lo Kat brand since it began leasing rights from Guangzhou Pharmaceutical in 1995. The company was authorized to use the brand until 2010, when it secured rights for an extension to 2020 from a Guangzhou Pharmaceutical executive who was later convicted of accepting bribes from JDB.

The lease was nullified and the two companies then began a long-running series of claims, counterclaims, lawsuits and marketing battles.

haonan@chinadaily.com.cn

(China Daily 08/13/2014 page17)