The Beijing Municipal High People's Court said the local firm Zhongshan-based Zhujiang Beverage had "violated moral principles" with "obvious intention to duplicate and copy from another high-profile trademark", BBC reported.
Zhujiang Beverage, which sells products like milk-flavored drinks and porridge, said it registered its trademark "face book" in 2011. The company faced objections from Facebook, but gained approval from the Trademark Review and Adjudication Board the country's trademark authority in 2014 to use it.
Along with other social media platforms like Twitter, Facebook is currently blocked to nearly 700 million internet users in China.
The court judgement was a reprieve of sorts for the Facebook as Apple last week lost itstrademark fight in Chinato a handbag firm which won legal case to retain the name Iphone.
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The court ruling in favour of Facebook has led Chinese local media to speculate whether Beijing's hard stance against Facebook might soften.
In whatcritics described as a publicity stuntto win China's favour, he also went for a run on Beijing's Tiananmen Square despite heavy pollution and also achieved celebrity status by making speeches in Mandarin.