A Korean business club-owner has been ordered to pay damages to international luxury firm Chanel for using its brand name for his business in a suburb of Seoul.

The Seoul Central District Court on Tuesday ordered the owner to pay 10 million won ($8,800) in compensation to Chanel, saying the bar, called “Chanel Business Club,” inflicted damage to the brand value of the top luxury company.

“The defendant, by using Chanel’s image for his business which is commonly associated with a negative image, inflicted damage to the brand value of Chanel,” judge Kim Hyun-seok said in the ruling.

In the lawsuit, Chanel claimed that the bar’s use of “Chanel” in signs and leaflets for its business for years has damaged the distinctiveness of the registered trademarks owned by Chanel.

The bar owner didn’t respond to any request from the court during the trial and didn’t plead his case.

In a similar case, the Daejeon High Court in 2010 ruled that a local karaoke bar’s use of Burberry name violated the rights of the British luxury brand. The karaoke bar was ordered to pay 2.5 million won in damages to Burberry.

By Lee Sun-young (milaya@heraldcorp.com)