APAA TRADE MARK COMMITTEE REPORT 2009 MALAYSIA. by Linda Wang TAY & PARTNERS

Transcription

1 APAA TRADE MARK COMMITTEE REPORT 2009 MALAYSIA by Linda Wang TAY & PARTNERS Part I LEGISLATIVE CHANGES There has been no amendment to the Trade Marks Act 1976 or the Trade Marks Regulation 1997 since the last report. Part II RECENT CASE LAW Sanbos (M) Sdn Bhd v Tiong Mak Liquor Trading (M) Sdn Bhd [2008] 1 LNS 45 High Court Plaintiff is the proprietor of trade marks CLUB 99 and CLUB 999. The Defendant is a manufacturer, bottler, distributor and seller of liquor and spirit bearing TRIPPLE 999 mark since November Plaintiff applied for an injunction against the Defendant, claiming trade mark infringement and passing off. Plaintiff s application was dismissed with costs. It was held that there were obvious dissimilarities between the Plaintiff s and Defendant s marks phonetically and visually. The Plaintiff did not have exclusive right to use the numerals 99 and 999 as it had disclaimed the right during registration. Plaintiff only had exclusive right to the word CLUB. Hence, when considering Plaintiff s registered rights, the court would disregard the numerals in the Plaintiff s registration. The Plaintiff also failed to adduce evidence to show that it had been using or promoting its mark. Furthermore, the Defendant started using its mark prior to the Plaintiff s application date.

2 UBS AG v UBS Corporation Sdn Bhd [2008] 1 LNS 780 High Court This was an application by the Applicant to rectify the Register by removing the amendment made to the Respondent s original trade mark under Section 44 of the Trade Marks Act The Applicant is one of the world s largest financial firms and is the common law proprietor of the mark UBS worldwide. The Respondent is the registered proprietor of the trade mark UBS in Malaysia under Class 9 for computer software since December The representation of the original mark that was applied for by the Respondent when it first became registered had a square logo with rectangular components, and the letters UBS under which there were the words User Business System. On September 2001, Respondent applied to amend the mark which resulted in the current representation of the mark which is simply the letters UBS. Application for amendment was allowed and was gazetted on November There wasn t any doubt that the Respondent has been continuously using the trade mark UBS before the Applicant ventured into the Malaysian market and that it had accumulated enormous goodwill and reputation in Malaysia. However, the mark UBS is associated worldwide with the Applicant. The Applicant argued that it is a person aggrieved by the alteration made in the Register as the alteration was outside the ambit of Section 44(1), contravenes Article 6bis of the Paris Convention and Article 16 of TRIPs Agreement and other provisions in the Trade Marks Act On the question as to whether the Applicant was a person aggrieved under Section 45(1) the Court answered in the affirmative because if the Applicant applied to register UBS in Malaysia, it would obviously be blocked by the Respondent s registered UBS mark. On whether the amendment was outside the ambit of Section 44(1), the Court agreed with the Applicant. The power to amend under Section 44 is limited to adding or altering the trade mark in a manner NOT substantially affecting the identity of the trade mark. The deletion of the square with rectangular components and the deletion of the words User Business System affected the identity of the mark substantially. 2

3 As for the issues relating to Section 14(1)(d) and (e) on well known marks, the Court held that it can be of no assistance as these sections were amended in the year 2000, well after the date of original registration, but the provisions are relevant to the amendment of the mark. The Court ordered the Register to be rectified by removing the alterations made to the Respondent s original trade mark. Note: The High Court s decision has been reversed by the Court of Appeal on appeal by the Respondent. The written decision of the Court of Appeal is yet to be published. Consitex SA v TCL Marketing Sdn Bhd [2008] 8 CLJ 444 High Court The Plaintiff is the registered proprietor of the trade marks ZEGNA and ERMENEGILDO ZEGNA in Malaysia in respect of clothing, boots, shoes and slippers. The garments bearing the Plaintiff s trade mark had been sold in Malaysia since Defendant had been trading under the EMMER ZECNA trade mark for garments since Defendant applied to register Z EMMER ZECNA & Device. The Plaintiff opposed the application and argued that the trade mark EMMER ZECNA was confusingly similar to the Plaintiff s registered trade marks and thus amounts to infringement of its trade marks. Defendant contended that the marks were not identical and did not so closely resemble the Plaintiff s trade marks as to be likely to deceive or cause confusion in the course of trade. Plaintiff s claim was dismissed by the High Court. When applying the test laid down in Re Pianotist and Tohtonku of whether a mark is likely to deceive of cause confusion, the comparison of the marks, visually and orally, must be done in its entirety. The Court held that there were substantial and significant differences between the marks which would not give rise to confusion in the market. It was also held that there was no likelihood of consumers being deceived at the point of sale as the distribution channels are different. Plaintiff s garments are sold in boutiques located in exclusive locations whereas the Defendant s garments are sold in island counters in 3

4 departmental stores, supermarkets, and shopping outlets in shopping malls. The Plaintiff s and Defendant s goods are not in direct competition. Plaintiff also failed to show evidence that there was such a wrong purchase in the mistaken belief that the Defendant s goods were the same as that of the Plaintiff. The survey report tendered by the Plaintiff had not provided any direct evidence as it was conducted post date of the writ and prior to the trial and not prior to the filing of the writ. The Plaintiff had failed to discharge their burden of proof on a balance of probabilities to satisfy the Court that Defendant had infringed Plaintiff s registered trade mark or had passed off their products as that of the Plaintiff s products. Yong Sze Fan v Sharifah Mohd Tamin [2008] 8 CLJ 613 High Court The Applicants applied to expunge the Respondents TAMIN trade mark on the ground that the entry was wrongfully made. The Applicants claim that they were the first user of the trade mark TAMIN and that they were the first to apply for the mark to be registered in 1990 while the Respondents only applied for it to be registered in The First Respondent on the other hand claims that her late father (Hj Tamin Wahi) was the first user of the trade mark TAMIN. The Respondents also claim that although the company applied for the trade mark to be registered in 1998, they have been using the TAMIN trade mark since 1980s. The Court held that the entry of the Respondents mark into the Register was an entry rightfully made. Based on the evidence, it was clear that the Respondents were the first user of the TAMIN trade mark. Just because the Applicants applied for it to be registered before the Respondents does not mean that they were the rightful first user of the TAMIN trade mark. Thye Huat Chan Sdn Bhd v Thye Shen Trading Sdn Bhd [2008] 6 CLJ 915 High Court This is an action to set aside a Trade Description Order ( TDO ) obtained by the Respondent. The goods which were the subject matter of the TDO were tapioca starch bearing the CAP KAPAL ABC trade mark. The TDO that was extracted was not the order which the judge had 4

5 granted. The draft TDO that was prepared by the lawyers and submitted to the Court for filing reflected the judge s order which specified the offending marks but the Registrar, mistakenly thinking that the subject of the TDO was in relation to a get-up had amended the TDO to be in relation to a get-up. No steps were taken to correct the mistake and the TDO was executed against the Applicant. The Applicant sought to set aside the TDO on the grounds that the TDO was bad and not what the judge had ordered and also that the Respondent failed to make full and frank disclosure when applying for the TDO. The Court set aside the TDO because the TDO that was extracted was never granted. There was no basis for its existence and it was null and void. Furthermore, the Court was influenced by the fact that a TDO is not only a piece of conclusive evidence, but virtually creates an offence. Amendment to the TDO is no longer possible as it had expired even before the close of submission. The TDO was also additionally set aside on the ground of non-disclosure as the Respondent did not disclose the fact that it was aware that the Applicant and other traders had been importing and selling tapioca starch with the ABC trade mark and that the Respondent knew of their identities and particulars. Meidi-Ya Co Ltd, Japan v Meidi (M) Sdn Bhd [2009] 2 CLJ 15 Federal Court This case was in relation to an appeal and cross-appeal to the Federal Court involving a trade mark dispute where the Federal Court had to determine if the questions for appeal had been properly framed. The history of the case is as follows: The Plaintiffs and First Defendant made separate applications to register the trade marks bearing the name MEIDI - YA. The Registrar of Trade Mark found the applications to be competing with each other and directed the parties to have their rights determined by the court pursuant to Section 19(3) of the Trade Marks Act

6 In the High Court, the judge allowed registration of the trade name of First Defendant but with the stipulation that the word YA after the word MEIDI not be used. The Plaintiffs were allowed to register their trade marks except one application with the combination of the words FRESH BAKERY which was identical to the First Defendant s. The First Defendant appealed to the Court of Appeal whilst the Plaintiffs cross-appealed. In the Court of Appeal, the High Court order for the First Defendant to remove the word YA in its application was set aside. Otherwise, the other orders remained the same except with some minor amendments. The cross-appeal was dismissed. The Plaintiffs then applied for leave to appeal to the Federal Court. 7 questions were framed to be referred to the Federal Court but upon reframing, only 5 questions remained. The questions and decision of the Federal Court are as follows (decision is italicized): 1. whether the use of the name and trade mark MEIDI - YA in Malaysia entitled the Appellants (Plaintiffs) to sole ownership of the said trade mark This question sought a reversal of the Court of Appeal s finding of fact. It was not couched in such a manner as to incorporate a point of law without any further evaluation of the evidence. Thus, the Federal Court held that there is no need to answer this question. 2. whether the Respondent (First Defendant) ought in law to be allowed to register its trade mark This is also attempting to reverse the finding of fact made by the Court of Appeal. 3. if after having found the Appellants entitled to register MEIDI - YA, whether it is permissible in law to allow the Respondent to register a trade mark with the name MEIDI - YA in it albeit in a different font The Federal Court held that this question did not flow from the judgment of the Court of Appeal and was therefore irregular. It is also very general in nature. 6

7 4. whether ownership, goodwill and reputation in business in Malaysia may be considered solely on international reputation or spillover reputation and goodwill Here it was held that the Appellants are trying to get a ruling from the Federal Court to extend the current changing trend in law (well known marks). However, the rights of the parties are determined as at the date of the application for registration. Hence any answer to this question would only have academic value and the Federal Court therefore held that there is no need to answer it. 5. whether it was permissible under the law of passing off for two separate independent parties to use an identical or confusingly similar trademark in Malaysia in respect of the same description of goods. Federal Court held that this question is defective as it was based on assumed state of affairs which was inconsistent with a specific finding of the Court of Appeal. Regent Pumps Pty Ltd v Keylargo Industrial Sdn Bhd [2009] 2 CLJ 303 High Court The Applicants applied to expunge the Respondent s mark from the Register or to substitute the Applicants name as the registered owner pursuant to Section 45 of the Trade Marks Act The Applicants are the proprietors of the marks OPAL PUMPS and OPAL. The Respondent was the distributor of the Applicants products bearing the mark OPAL in Malaysia. In 1999, the Respondent registered the mark OPAL in its own name in Malaysia. The Respondent then ceased to be the Applicants distributor. The Applicants later found out that the Respondent wrongfully registered the mark under its own name and filed this application. The Court ordered for the trade mark to be expunged from the Register on the ground that the Applicants were the first user of the mark in Malaysia. The Applicants satisfied the requirement of an aggrieved person under Section 45(1) as they were the lawful proprietor of the marks in Malaysia. The Court also held that the Respondent had obtained the registration of the mark in Malaysia by fraud as they had obtained registration knowing that the lawful proprietor of the mark was the 7

8 Applicants. In the absence of documentary evidence showing that permission was given by the Applicants, the Respondent was not entitled to register the mark in Malaysia. Nonetheless, even if such permission was given, the Respondent was not entitled to register the mark under its name as it was not the lawful proprietor. Sanmaru Overseas Marketing Sdn Bhd v PT Indofood Interna Corp [2009] 3 CLJ 10 Court of Appeal This was an appeal to the Court of Appeal by the Defendants against the decision of the High Court pertaining to the Plaintiffs claim for the assignment of INDOMIE trade marks, from the Second Defendant to the First Plaintiff, for a consideration of RM 10 pursuant to a Deed of Assignment. The Defendants contended that the agreed consideration was USD 680,000. The Court of Appeal dismissed the appeal as there was no reference to any agreement to show that the consideration agreed upon was USD 680,000. The Third Defendant s version that an oral agreement was reached did not represent the truth and it was neither credible nor believable. It was held that the High Court judge was justified in giving judgment in favour of the Plaintiffs given the ample documentary evidence. Titan (M) Sdn Bhd v The Registrar of Trade Marks [2009] 7 CLJ 338 High Court This is an appeal against the decision of the Registrar rejecting the Appellant s application to register the trade mark SURE-Loc on the ground that the Appellant failed to comply with the requirements of Section 10(1) of the Trade Marks Act The Appellant claims that the mark had acquired factual distinctiveness as it had registered the trade mark in Singapore. The Court did not find Section 10(1) satisfied and dismissed the appeal. The Court held that the mark was neither a name nor a signature. The mark also cannot be an invented word as it is merely a combination of the words sure and loc, which is intended to be a misspelling of sure-lock. The mark together with the device of a key lock has a direct reference to the character and quality of the Appellant s goods. The mark is also not inherently distinctive. Since 8

9 trade mark registrations are territorial in nature, the fact that the Appellant had successfully registered the mark in Singapore does not make it factually distinctive in Malaysia. Koh Chui Ngoh v Magicboo Beauty Sdn Bhd [2009] 1 LNS 196 High Court The Plaintiff imports, manufactures, markets and sells beauty products and supplies and has been importing glue for eyelashes with the marks EYE PUTTI and CECIL since The Plaintiff sued the Defendant for infringement of its CECIL trade mark and for passing off. At the trial the Plaintiff conceded that the mark CECIL was not a registered trade mark and hence, the action for infringement could not stand by virtue of Section 82(1) of the Trade Marks Act Nevertheless, the Plaintiff succeeded in its passing off action against the Defendant as all the elements of the tort of passing off were successfully proven by the Plaintiff. Philip Morris Products SA v Ong Kien Hoe [2009] 1 LNS 498 High Court Plaintiff is the manufacturer and distributor of cigarettes and tobacco products under the trade mark MARLBORO throughout the world. Plaintiff is also the registered proprietor of that trade mark in Malaysia. Two containers containing cigarette boxes bearing the mark MARLBORO were detained by the Customs. Upon inspection, it was found to be counterfeited cigarettes. The Second Defendant was the forwarding agent whereas the First Defendant was the consignors. Plaintiff claims against the Second Defendant for infringement of the trade mark MARLBORO and for passing off or attempting to pass off counterfeit cigarettes as products belonging to the Plaintiff. The Second Defendant on the other hand submitted that it was merely carrying out its duties as a forwarding agent for a named principal and hence not liable. The Second Defendant also submitted that since the counterfeit cigarettes were within the Free Zone, they were in 9

10 transit and not being imported into Malaysia. Therefore they are not subjected to import duties and to Malaysian laws and consequently, the seizure was wrongful. It was held that the seized items bore a trade mark which was identical to the Plaintiff s trade mark. Since the Plaintiff had not authorized or licensed the Second Defendant to use that registered trade mark, there was infringement. It was also held that the Second Defendant was not a mere forwarding agent. The evidence presented revealed that there was active participation on the part of the Second Defendant. It was further held that the Free Zone area is not free of all laws or that there is lawlessness in that zone. Enforcement agencies continue to hold jurisdiction over the zone. In any event, the issue of the validity of seizure was not relevant in relation to the Plaintiff s claims. Plaintiff s rights in the registered trade mark were rights in rem. Plaintiff s claims were therefore allowed. McLaren International Ltd v Lim Yat Meen [2009] 4 CLJ 749 Federal Court This is an appeal to the Federal Court by the Appellant for an order to expunge totally the entry of the Respondent s trade mark from the Register of Trade Mark and an alternative prayer to expunge the registered trade mark only in relation to some of the specified goods for reason of non-use. The Appellant cited Sections 14, 25, 45 and 46(1) of the Trade Marks Act 1976 to support its application. The Appellant had failed both in the High Court and the Court of Appeal and leave to appeal to the Federal Court was granted. The brief background of the case is as follows. The Respondent has been the registered proprietor of the trade mark MCLAREN in Malaysia since 1992 in respect of articles of clothing, including boots, shoes and slippers in Class 25. The Appellant, claiming to be the bona fide proprietor of the mark MCLAREN, applied for it to be registered in Malaysia in 1999 in respect of articles of clothing, footwear and headgear in Class 25, only to have it rejected by the Registrar on the ground that it was identical to a prior registered trade mark. The Appellant then applied to the High Court for an order to expunge the registered trade mark under Sections 45(1)(a) and 46(1). In order to expunge, the Appellant had to show that it is a person aggrieved. 10

11 The Appellant failed in the High Court and in its appeal to the Court of Appeal. Both the Courts found that the Appellant was not a person aggrieved entitled to seek expungement of the Respondent s mark. The Appellant sought leave to appeal to the Federal Court and leave was granted. However, Federal Court dismissed the appeal on the same ground, namely, that the Appellant was not a person aggrieved. The Federal Court held that a person whose application for registration of his trade mark is jeopardized by Section 19(1) cannot qualify as a person aggrieved as he could be a mere busybody. Hence, the Appellant has no locus standi to bring the current application. McCurry Restaurant (KL) Sdn Bhd v McDonalds Corporation [2009] 3 CLJ 540 Court of Appeal This was an appeal to the Court of Appeal against the decision of the High Court which held that the Appellant s (Defendant in the High Court suit) use of the word McCurry amounted to passing off of the Respondent s (Plaintiff in the High Court suit) trade name McDonalds. The main issue considered in the appeal was whether the trial judge had judicially appreciated the evidence in coming to her decision. The Respondent was a fast food franchisor with outlets all over the world. The Appellant on the other hand ran a fast food outlet which offered Indian and other local Malaysian cuisine. It did not serve any food which is the same as those offered in the Respondent s outlets. The Respondent claimed that the Appellant had copied and adopted the Respondent s distinctive Mc identifier for its own food and beverage outlet. The trial judge found for the Respondent and held that customers familiar with the McDonalds trade mark would logically assume that the Mc in the Appellant s McCurry restaurant was associated in some way to the Respondent or was an extension of the Respondent s current range of products and services. The trial judge heavily relied upon the decision in the case of McIndian which held that the McIndian mark was confusingly similar to the McDonalds family of marks all employing the prefix Mc. The trial judge s decision was reversed on appeal. The Court of Appeal held that the Appellant s presentation of its business was in a style and get-up distinctively different from that of the 11

12 Respondent. Furthermore, the items of food available at the Respondent s outlet all carried the prefix Mc whereas in the Appellant s outlet, none did so. The type of food served is also very different. Even the types of customers who patronise the Respondent s outlets were very different. The Court of Appeal also distinguished the McIndian case that was relied upon by the trial judge. In that case, McIndian was not only selling Indian food but also Southern fried chicken, cheeseburgers, French fries and shakes which are very similar to the items that McDonalds sells. The trial judge s omission to distinguish the facts of the McIndian case from the instant case constituted a serious misdirection which had resulted in a miscarriage of justice. The Court of Appeal drew an irresistible inference from the totality of the evidence that the Appellant s signboard could not reasonably result in persons associating McCurry with McDonalds. The Court of Appeal also held that the trial judge erred in assuming that the Respondent had a monopoly in the use of the prefix Mc. Thus, the trial judge misdirected herself on the proper inferences to be drawn from the proved and admitted facts and that there was no judicial appreciation of the most important pieces of evidence. Update: The Respondent (Plaintiff in the suit) had applied for leave to appeal to the Federal Court but on 8 th of September 2009, the Federal Court unanimously refused the Plaintiff s application for a leave to appeal on the ground that the questions referred to the Federal Court by the Plaintiff were not properly framed. Leo Pharmaceutical Products Ltd A/S (Lovens kemiske Fabrik Produktionsaktieselskab) v Kotra Pharma (M) Sdn Bhd [2009] 5 AMR 132 High Court The Plaintiff carries on the business of manufacturing and distributing prescription drugs, including antibiotics preparations containing fusidic acids bearing the registered marks FUCIDIN and FUCICORT. The marks have been registered in Malaysia for more than 7 years. The Defendant carries on the business of manufacturing and sales of pharmaceutical products bearing the marks AXCEL FUSIDIC and AXCEL FUSI-CORTE. The Plaintiff sought injunctions to restrain the Defendant from using the Plaintiff s marks and claimed that the Defendant is liable for trade mark infringement and passing-off. The Defendant counterclaimed for rectification, invalidation and expungement of the Plaintiff s marks and 12

13 claimed damages arising from the Plaintiff s unlawful interference with the Defendant s trade or business. The trial judge proceeded to decide on the Defendant s counterclaim first before considering the Plaintiff s case. The Court found for the Plaintiff and held as follows 1. On whether the Plaintiff had defrauded the Registrar of Trade Marks, it was found that the word fraud in s 37 of the Trade Marks Act 1976 ( the Act ) was not defined but applying its ordinary, popular grammatical and dictionary meaning, fraud involves actual deception or omission by word or deed. The Defendant s counterclaim did not plead nor particularize the Plaintiff s actual deception and intention to deceive and as such, the Defendant s averments do not constitute deception as a recognized category of fraud. 2. Section 36 of the Act confers on the registered proprietor prima facie evidence of the validity of the original registration of the trade mark. As the Plaintiff s trade marks have been registered for more than 7 years, the validity of the marks cannot be challenged except in specified circumstances. 3. The Act does not prohibit the registration of trade marks which are INNs or confusingly similar to INNs. In the absence of statutory enactment, the INN guidelines cannot become part and parcel of the Act. Therefore, as the Plaintiff s marks FUCIDIN and FUCICORT are not fusidic acid and corticosteroid respectively, they are registrable. 4. The word FUCICORT is a distinctive and registrable mark as it is a portmanteau word, i.e., a word which is formed by telescoping two dictionary and generally descriptive words, which in this case, is fusidic acid and corticosteroid. 5. Although an INN is not registrable as a trade mark since it is generic in nature and cannot be monopolized by any trader as members of the public may use it, this does not prevent pharmaceutical trade mark applicants from choosing names which allude to INN, or even trying to secure registration of a trade mark which is as close as it can be to the forbidden INN. Although a trade mark cannot be directly descriptive, it need not be absolutely suggestive. Words containing covert and skillful allusion to the character or quality of the goods involved are still registrable. In short, a word or a term, even a descriptive one, can still qualify as a trade mark so long as it is distinctive or capable of being distinctive. 13

14 6. Any approach which tends to dissect FUCIDIN into Fuci and din, and FUCICORT into Fuci and cort would run counter to the ratio in Eastman Photographic Material Co s Application [1898] 15 RPC Fusidic acid is the accepted name or generic term for the chemical element or API of FUCIDIN product and corticosteroid is the accepted generic term found in the FUCICORT product. The correct INNs are fusidic acid and corticosteroid and not FUCIDIN or FUCICORT. 8. Section 33(4) which prohibits the registration of any word which is the commonly used and accepted name of any single chemical element or single chemical compound will only apply if FUCIDIN and FUCICORT are used as such and not used as brand names at all. 9. On the evidence, the Defendant had failed to prove that the Plaintiff s marks have lost their distinctiveness when the instant suit was filed in The marks FUCIDIN and FUCICORT are still trade marks and as such are source indicators. If anyone, other than the Plaintiff was to use them for their pharmaceutical products, the public will inevitably think that they are the Plaintiff s products. Therefore, the Defendant s claim of loss of distinctiveness is devoid of merit. 10. As the Plaintiff s trade marks were duly registered pursuant to the provisions of the Act, the Plaintiff enjoys proprietary rights over the goodwill generated through the extensive use of the said trade marks. Being the bona fide proprietor of the trade marks, the Plaintiff has every right to enforce such rights, in which case, the Plaintiff cannot be regarded as using unlawful means. The Defendant has failed to discharge the burden of proof that the Plaintiff has unlawfully interfered with the Defendant s trade or business. 11. The Defendant has infringed the Plaintiff s registered trade marks. The Defendant cannot escape infringement by establishing that it was not intended that the mark is to function as a trade mark. 12. The Plaintiff has proved the first element of passing off namely that the Plaintiff has sufficient reputation or goodwill in the indicia of origin of FUCIDIN and FUCICORT and there was no corresponding challenge by the Defendant. Thus, the Plaintiff has successfully proved that FUCIDIN and FUCICORT are distinctive of it. 14

15 13. The Plaintiff has also established the second element of misrepresentation by reference to the Defendant s two get-ups in the words Fusidic and Fusi-corte. The use of these words by the Defendant is calculated to lead to the belief that their business is in some way connected with the Plaintiff s. 14. The Plaintiff has adduced sufficient evidence to show that it has suffered damage or that there is a very high probability that it will suffer damage as a result of the Defendant s acts. 15. The continued use of the Defendant s impugned marks Fusidic and Fusi-corte which are indistinguishable from the Plaintiffs trade marks, will inevitably lead to a situation where the Defendant s generic products may be passed off, or confused or even worse, be equated with the Plaintiff s originator products. The end result would be the Plaintiff s loss of exclusivity of the Plaintiff s trade marks and an unfair advantage to the Defendant. 16. The principle that loss of exclusivity of the Plaintiff s trade marks has been recognized as a separate species of damages which will make up the tort of passing off, applies equally to the instant case which involves trade marked goods. Papparoti (M) Sdn Bhd v Roti-Roti International Sdn Bhd [2009] 5 AMR 326 High Court This was an application by the Defendants to set aside the ex parte injunctive order that was obtained by the Plaintiff. The Plaintiff is the manufacturer and seller of butter-filled buns commonly known as Mexican bun under the name PAPPAROTI. The Defendants were in the same business as the Plaintiff. Plaintiff was approached by two individuals (directors of Defendants) to discuss possibilities of incorporating a joint venture company to expand the PAPPAROTI business to foreign markets. An oral agreement was entered into and a joint venture company was incorporated in Hong Kong. The company managed to break into the Korean market and entered into an agreement with a Korean investor by which the investor was to source the supply of the buns and related products from the company and employ the PAPPAROTI brand for her outlets in South Korea. The Korean investor went ahead and registered PAPPAROTI KOREA in South Korea Register of Trade Mark. 15

16 Due to a dispute between the Plaintiff and the directors of Defendants, the Plaintiff ceased the supply of dough and toppings to the joint venture company. As a result, the directors requested the Third Defendant to supply the necessary dough and toppings to the company. On 5 th March 2009, Plaintiff obtained an injunction and an Anton Piller Order against the Defendants by way of an ex parte application to restrain the Defendants from infringing the Plaintiff s trade mark and passing off its goods as that of the Plaintiff and to search and seize documents bearing the Plaintiff s trade mark. The Defendant applied for it to be set aside. The High Court allowed the Defendants application and set aside the ex parte order on grounds that there were no serious issues to be tried. It was held that at the material time, the PAPPAROTI mark was yet to be registered and by virtue of Section 82(1) of the Trade Marks Act 1976 no person was entitled to initiate an action for infringement of an unregistered trade mark. Furthermore, the mark was only registered in respect of finished products such as buns and breads and does not include dough and toppings which are goods capable of separate registrations. Hence there can be no infringement of the trade mark. Furthermore, there is no likelihood that the mark used by the Defendants would deceive or cause confusion because at all material time, the dough and toppings manufactured by the Defendants were not sold in Malaysia but instead, were supplied to only one customer in Korea. As for passing off, it was held that in order for the Plaintiff to succeed, it must have goodwill in Korea since the dough and toppings were not sold in Malaysia but in Korea. The Court held that the Plaintiff has no goodwill in Korea. There was no element of misrepresentation as well because it was established that the Korean client knew that the Defendants were supplying the dough and toppings. Hence, elements of passing off could not be proven. As for the Anton Piller Order, the Court held that it was wrongfully obtained and set it aside. The Court further held that the Plaintiff had failed to disclose that the Korean investor was entitled to use the mark in Korea as she was the registered proprietor there. Part III OTHER MATTERS OF GENERAL INTEREST Statistics on Trade Marks Applications and Registrations from July

17 YEAR APPLICATION REGISTRATION Malaysia Foreign Total Malaysia Foreign Total ,562 13,472 26,034 9,049 18,798 27,847 Jan , ,057 Feb ,021 1, ,190 Mar 09 1, , ,326 Apr ,026 2, ,066 May 09 1, , ,185 June 09 1, , July 09 1, , ,403 Launch of Penang IP Court Penang has launched its first IP Court which is similar to the Kuala Lumpur IP Sessions Court. Tuan Roslan bin Hamid will be the first IP Sessions Court Judge of Penang. New Court Tracking System Effective from 3 rd February 2009, the Courts in Kuala Lumpur adopted a new tracking system. The objective of the re-organization was to streamline the administration of the Civil & Commercial Division of the High Court in Kuala Lumpur (save only for family matters) to ensure uniformity, expeditious and efficient disposal of cases with optimum use of judicial time. As part of the efforts to achieve uniformity, expeditious and efficient disposal of cases, the judges at the Kuala Lumpur High Court will be divided into 2 groups: 1. A Track Cases - A Track judges will hear and dispose off all legal applications involving affidavit evidence. 2. T Track Cases T Track judges will hear and dispose off all legal applications involving oral evidence. 17

18 Before any application comes before a judge for hearing, the Deputy Registrar will manage the application under the direction of a managing judge Special 301 Report Prepared by the Office of the United States Trade Representative Based on the Report dated 30 th April 2009, Malaysia will remain on the Watch List in The Report stated that it was concerned with the decline of enforcement efforts for the past year. It also reported that there were backlog in the adjudication of cases in the specialized IP Courts. The United States encourages the Malaysian Government to provide the requisite training and resources to its prosecutors and judges to enable these Courts to adjudicate cases effectively and efficiently. The United States also urged Malaysia to continue its efforts to update its IP laws and also to accede to and fully implement the WIPO Internet Treaties. 30 September