EVEN DOCUMENTS IN ARCHIEVE CAN ALSO CAUSE TRADE MARK CONFUSION AMONGST CONSUMERS

February 13th, 2012

 

In the case of Jacmoli Designs & Jewellers Sdn. Bhd. vs. YTL Corporation Berhad, the Malaysian High Court in Kuala Lumpur upheld a trademark infringement claim over archived jewelry items on a community website. The Court in Kuala Lumpur held that even documents that have been achieved but still accessible to the public can create confusion amongst the consumers and therefore, held that the action of the Defendant who published two articles which made reference to the Plaintiff and the trade mark registered by the Plaintiff constitutes a trade mark infringement and passing off.

Jacmoli Designs & Jewellers (hereinafter referred to as "the Plaintiff") is the owner of a registered trademark "JacMoli" in class 14 in Malaysia (hereinafter referred to as "the Trade Mark") and a few other countries such as Hong Kong and Singapore for goods such as jewelry, good, silver, platinum and other precious stones such as jade.

The Plaintiff is private limited company speacialising in producing and selling high quality jewelry items such as jade and it was a tenant in Starhill Gallery Shopping Mall until 7 May 2007, an upmarket shopping mall in downtown Kuala Lumpur which is listed as one of Asia's most beautiful shopping malls and had since moved out to Wisma MPL also in Kuala Lumpur.

YTL Corporation Berhad (hereinafter referred to as "the Defendant"), is a public listed company and is the owner of Starhill Gallery and it operates a community website www.ytlcommunity.com and aims to provide a platform for companies located in Starhill Gallery to promote themselves and their products and services.

According to the facts of this case, the Plaintiff argued that the Defendant had infringed the Trade Mark and also involved in an act of passing off as the Defendant had published two articles about the Plaintiff entitled "Star-studded launch for JacMoli at Starhill Gallery" and "Twins Mission Duo at Starhill Gallery" and the articles made reference to the Plaintiff and to the Trade Mark when the Plaintiff was no longer operating in Starhill Gallery. According to the Plaintiff, these articles have confused the consumers into believing that the Plaintiff was still in Starhill Gallery when the Plaintiff was clearly not. The Plaintiff had also provided a witness who claimed that she thought that the Plaintiff was still in Starhill Gallery when she read the articles in the website and when she went there, she was told by the receptionist at the Information Counter at Starhill Gallery that the Plaintiff had moved out and she was then recommended to visit other jewelry outlets in there.

In its counterclaim, the Defendant had argued that the articles were prepared based on the Plaintiff's news release when the Plaintiff opened its outlet in Starhill Gallery and the articles had since had been achieved. The Defendant had argued that the fact the documents were achieved showed that the articles were originally published to promote the Plaintiff when the Plaintiff was a tenant at Starhill Gallery and that these are articles are with historical data and the articles are not meant to be viewed as current.

The Defendant had also filed a request for the Trade Mark to be expunged due to the fact that there had been no bona fide use of the Trade Mark by the registered proprietor for a continuous period of three years up to one month before the Defendant's counterclaim to expunge the Plaintiff's mark.

The Defendant had brought another interesting point in its counterclaim. The Defendant had indicated in its counterclaim that the Plaintiff had brought the current trade mark infringement and passing off case so as to settle another case involving recovery of arrears in rental and other charges under the tenancy agreement signed by the Plaintiff and Mayban Trustees Berhad who is the legal owner of Starhill Gallery. The Defendants had showed two letters from the Plaintiff's solicitors demanding, inter alia, a payment of RM6 million (approximately USD2 million) and the settlement of the case between the Plaintiff and Mayban Trustees. The Defendant had argued that it is not related to Mayban Trustees whatsoever and the Plaintiff's claim for trade mark infringement and passing off is mala fide with the sole purpose of "achieving a collateral and wrongful purpose and/or to cause maximum embarrassment and damage to the Defendant and is an abuse of the of the process of the Court".

In this case which took 71 days to be completed, the Court held that the Plaintiff had proven that the Trade Mark had been infringed and the Plaintiff's goodwill and reputation had been passed off by the Defendant and hence allowed the Plaintiff's claim with costs. The Court held that the fact that the articles were still accessible in the website means that the Defendant had been using the Trade Mark to promote Starhill Gallery. This is supported by the witness provided by the Plaintiff who said that she was asked to visit other jewelry outlets when she went there thinking the Plaintiff was still operating in Starhill Gallery after reading the articles in the website.

The Court also rejected the Defendant's counterclaim and highlighted the fact that the Trade Mark had been used continuously by the Plaintiff i.e. through their sales receipts, documentary produced by a Chinese broadcaster etc. The Court accepted the Plaintiff's argument that the sales of the jewelry in Malaysia are low due to the fact that the jewelry was sold by way of consignment with the Plaintiff's Hong Kong headquarters. The Court held that minimal trading activities would suffice to establish goodwill and therefore all the promotional activities taken by the Plaintiff was more than sufficient to generate goodwill. The Court also said that the fact that a Chinese broadcaster was willing to produce a documentary about the Plaintiff's boutique in Malaysia showed that the Plaintiff had acquired reputation and goodwill.

The Court also rejected the Defendant's assertion that the current action was taken only to coerce the Defendant to withdraw the case involving the Plaintiff and Mayban Trustees and to cause damage and embarrassment to the Defendant. The Court found that there was no basis for the Defendant's contention that the action had been commenced in bad faith although the Plaintiff had initially demanded compensation of RM6 million, which was not pleaded or claimed in the statement of claim and the Plaintiff's claim was made only after the tenancy action had been initiated by Mayban Trustees against the Plaintiff and despite the Plaintiff's attempt to negotiate settlement with the Defendant by demanding Mayban Trustees to withdraw the tenancy action with no liberty to file afresh. The Court ordered the Defendant to pay for court costs.

This case clearly explained the importance of removing any form of documents that make reference to third party trade marks as this case may be cited as a precedent for similar cases after this. The witnesses provided by the Plaintiff were convincing and it had made the case tilted to the Plaintiff's favour.

ADIPVEN can assist in advising on how documents and marketing collaterals published in websites, books and papers should be managed. Our Trade Mark attorneys will also be able to assist you in the event that you or your clients are considering trade mark cancellation actions in Malaysia, India, Singapore, Thailand, Vietnam, Indonesia, Philippines and Brunei. Please do not hesitate to write to us at info@adipven.com if you need any further clarifications on this matter.