Kaixin001.com, known as the "Chinese Facebook", sued Qianxiang Hulian, the former operator of Kaixin.com in Beijing yesterday, alleging copyright infringement and demanding 10 million yuan ($1.5 million) in compensation.

Qianxiang Hulian denied the charge, saying Kaixin.com is now under the control of Qianxiang Wangjing, another subsidiary company of Oak Pacific Interactive Co.

"Before we heard the charge, we had already transferred the operating rights to Qianxiang Wangjing in accordance with group's long-term development goal. We applied in April and got the approval from Beijing Communications Administration in May," Cai Ming, public relations manager of Oak Pacific Interactive Co, told METRO yesterday.

"We have not avoided their charge or stalled for time in our response, like Kaixin001.com stated in court, because we received the summons in June," Cai Ming added.

Qianxiang Hulian also defended itself by saying the company bought the domain name through legal channels.

In addition to asking for 10 million yuan of compensation and a public apology, Kaixin001.com also wants Qianxiang Hulian to stop using Kaixin.com, the name Kaixin, or anything similar.

Kaixin001.com claimed in court it was "dishonest competition" because netizens could not tell the difference between the two sites, which caused a decline in numbers of registered users.

"Kaixin001.com has lost many potential users and suffered a heavy loss," a lawyer for Kaixin001.com argued in court.

The lawyer expressed a desire to settle the matter in court, but Qianxiang Hulian declined.

"If Kaixin001.com has any new ideas or suggestions, we are willing to have further negotiation," Cai told METRO yesterday. He insisted Kaixin.com would not accept Kaixin001.com's request to close their website.

Beijing Second Intermediate People's Court failed to reach a judgment yesterday, and did not reveal a date for the result.

Kaixin001.com was opened in March 2008 by Cheng Binghao, the former head of technology at Chinese media group Sina Corp.

It has more than 40 million users and more than 1 billion daily page views in August 2009, with an increase of 200,000 new registered members per day.

Seven months after opening, Qianxiang Hulian, a subsidiary company of Oak Pacific Interactive, launched Kaixin.com. It has the same Chinese name, a similar homepage design style, and the same network services.

"No matter what the final result it is, the lawsuit will not affect the regular service to millions of Kaixin users," Yu Yi, an analyst at Analysys International and an expert in social networking site market research, said.

There are now almost 10,000 social networking sites in China. Kaixin001.com occupies 38 percent of the market share and tops the list among Chinese social networking service providers, with Kaixin.com ranked fourth and holding a 6.5 percent market share.

Oak Pacific Interactive, the owner of Kaixin.com, is the largest operator of social networking sites in China. It also runs Mop.com, Renren.com, and information technology portal Donews.