Summary of Key Points
In September 2025, when NaiXue’s Tea launched its new product “MiBuBu,” it used large promotional letters stating “Drink MiBuBu and win LABUBU” (with a smaller note at the bottom indicating “No official cooperation with PopMart”). This led consumers to mistakenly believe there was a partnership between the two companies, resulting in NaiXue being ruled guilty of unfair competition and ordered to pay a compensation of 320,000 yuan. Although the amount is not large, the judgment is significant: it not only confirms the legal protection of the LABUBU IP but also serves as a warning to the new consumer industry about the ineffectiveness of using large promotional texts with small disclaimers and the high risks associated with IP crossover.
I. Why Did NaiXue Fail to Use LABUBU’s Fame? — Large Texts Attract Attention, but Small Disclaimers Are Ineffective
NaiXue argued in court, “I’m buying an authentic blind box, and there’s a disclaimer written on it—how could this be considered infringement?” The court’s response was straightforward: The large text highlighting LABUBU while hiding the disclaimer is a form of deception. Consumers see the prominent words “Drink MiBuBu and win LABUBU” and immediately assume there’s a partnership with PopMart; no one would bother to read the small print at the bottom. LABUBU has become so popular in the trend culture that it is considered an “influential product name” protected by law. The court ruled that this behavior constitutes confusion and violates anti-unfair competition laws—basically, using someone else’s fame to drive sales without fair compensation.
II. How Valuable Is LABUBU? — An IP Worth Three Times NaiXue’s Annual Revenue
LABUBU is not just a toy; it’s a cash cow for PopMart:
- In 2025, PopMart’s total revenue was 37.12 billion yuan, of which the “Spiritual Team” IP, which includes LABUBU, contributed 14.16 billion yuan (a year-on-year increase of 365.7%).
- NaiXue’s annual revenue for the same year was only 4.331 billion yuan, meaning the income from LABUBU alone is 3.27 times that of NaiXue.
- The 320,000 yuan in compensation was calculated based on 18 days of infringement (an average of about 17,800 yuan per day), which does not reflect the full commercial value of the IP. However, these numbers demonstrate the immense “traffic value” and profitability of an IP.
III. Why Did NaiXue Take the Risk of Using LABUBU’s Fame? — A Last-Ditch Attempt at Low-Cost Profit
NaiXue was facing financial difficulties:
- Its revenue decreased by 12% in 2025, with a net loss of 241 million yuan.
- It closed 152 stores, and the average transaction value dropped from 26.7 yuan to 24.4 yuan.
- Its stock price fell to 0.74 Hong Kong dollars, with a market value of 1.264 billion Hong Kong dollars.
- The cost of licensing an authentic IP is high; popular IPs require fees in the hundreds of thousands or even millions, plus a percentage of sales. NaiXue only needed to purchase a small number of authentic blind boxes as prizes to sell its new products, taking advantage of LABUBU’s popularity at a much lower cost.
- NaiXue also assumed that including a minor disclaimer would suffice to avoid legal issues, but it still crossed the line.
IV. What Lessons Does This Judgment Teach the Industry? — The Risks of IP Crossover
The 320,000 yuan judgment sends several clear messages to the new consumer industry:
1. Large texts and small disclaimers are misleading: The State Administration for Market Regulation issued a document in 2026 addressing ads that use large text to attract attention while hiding disclaimers. This judgment aligns with regulatory efforts; similar practices may now lead to both legal actions and fines.
2. IPs Now Have Legal Protection: With the court’s confirmation of LABUBU’s protected status, it will be easier for PopMart to enforce its rights against other brands (reducing the burden of proof).
3. High IP Licensing Fees Are a Barrier: The high costs of licensing top IPs prevent smaller companies from collaborating, which is one reason why such crossover attempts continue despite bans.
4. Crossover Attempts Harm Both Sides: It’s costly for IP owners to fight infringement, and for compliant companies, it creates an environment where lower-quality products outcompete higher-quality ones due to the prevalence of free-use tactics.
Conclusion
The 320,000 yuan in compensation may not seem like much, but it serves as a reminder to all businesses that in the IP economy, “borrowing traffic” is less effective than creating your own valuable IP. When your IP is legally protected, it becomes a strong defense against competitors. The revenue disparity between LABUBU and NaiXue highlights that in the new consumer era, those with genuine, valuable IPs hold the power to set prices and influence market trends.