MALAYSIA: “GS” v “GiSi” – BATTLE OF BATTERY GIANTS

June 19th, 2017

 

In the case of GS Yuasa Corporation v GBI Marketing Malaysia Sdn Bhd, GS Yuasa Corporation (hereinafter referred to as the “the Plaintiff”) applied to expunge the trade mark, “GISI Premium High Power” for goods in Class 09 in the name of GBI Marketing Malaysia Sdn Bhd (hereinafter referred to as the “the Defendant”) from the Register of Trade Marks.

In the High Court, the Plaintiff applied for the trade mark registered to be expunged based on the several issues. The first issue was whether the plaintiff had shown it was aggrieved by the defendant’s registered trade mark to enable them to make an application under Section 45(1)(a) of the Trade Marks Act 1976 (TMA). The second issue was whether the plaintiff can expunge the defendant’s registered trade mark based on three grounds:

(i) whether the original registration of the Defendant’s Registered Trade Mark by Osima Batteries Ind Sdn. Bhd. (OBI) had been obtained by fraud under Section 37(a) of the TMA; (ii) whether the use of the Defendant’s Registered Trade Mark based on the claimed goods were likely to deceive and/or confuse as well as to give a false impression to the public that the Defendant’s good originated from and/or is associated with the Plaintiff’s; and (iii) whether the Defendant’s Registered Trade Mark at the time of filing were distinctive of the goods claimed.

The third issue was whether the Court would give any weightage to the current originating summons (OS) to the decision of the Supreme Court of the Republic of Indonesia which had allowed the Plaintiff to expunge a trade mark similar to the Defendant’s Registered Trade Mark in Indonesia. The fourth issue was if the Court should draw an adverse inference against the Plaintiff for refusing to disclose the pricing of their goods; and lastly whether the Defendant can oppose to this OS by relying on the defence of the use of a substantially identical Defendant’s Registered Trade Mark as per Section 40(1)(f) of the TMA.

For the first issue, the issue of “person aggrieved” was discussed. The Court cited the case of McLaren International Ltd v Lim Yat Meen (2009) 4 CLJ 749 in which a “person aggrieved” in this context refers to someone who has used or has a genuine and present intention to use his mark as a trade mark in a course of a trade which is similar to the trade of the owner of the registered trade mark that he wants to have removed from the register. The Court held that the Plaintiff was indeed a “person aggrieved” by the Defendant’s Registered Trade Mark under Section 45(1)(a) on the grounds that the Plaintiff has used and was still using their trade mark in the course of trade for good in Class 09, the same class in which the Defendant’s Registered Trade Mark was being used. Thus, the Plaintiff’s business was adversely affected by the use of the Defendant’s Registered Trade Mark.

For the second issue, the three grounds for the Defendant’s Registered Trade Mark to be expunged were discussed. On the first ground, whether the original registration of Defendant’s Registered Trade Mark had been obtained by fraud was discussed. By referencing Tiga Gajah Cho Heng Sdn Bhd v Majuperak Tepung Beras Sdn Bhd, the Defendant’s counsel argued that the Plaintiff failed to prove the 3 elements of fraud under Section 37(a) TMA. Furthermore, the Defendant has also contended that OBI and the Defendant are separate legal entities in law. The Court decides to lift the corporate veil protecting OBI and the defendant based on the SSM records of OBI and the Defendant, and by way of the Assignment in which OBI purportedly assigned 2 registered trademarks, including the Defendant’s Registered Trade Mark, to the Defendant for only RM10.00. The Court found that the Assignment of the trade mark discussed herein was a sham. It made no sense in a commercial aspect for 2 genuine trade mark to be re-assigned to the Defendant for a mere value of RM10.00. There was also no evidence of negotiations between the 2 parties as well as a prove of payment to OBI. In addition, no explanations were given for the inordinate delay of more than 2 years and 3 months in the assignment of the discussed trade marks.

The Court ruled that the 2 conditions required to pierce or lift the corporate veil were fulfilled as (1) the Defendant’s solicitors failed request OBI to provide the Defendant with the evidence regarding the means of which OBI created, acquired, or adopted the Defendant’s Registered Trade Mark, upon being served with the OS; and (2) OBI also failed to provide OBI’s first use the Defendant’s Registered Trade Mark. Therefore, failing to prove that OBI and the Defendant are separate legal entities. Furthermore, the Plaintiff also succeeded in proving that the Defendant acquired the registered trade mark by means of fraud on the Registrar with the following evidence and reasons; (1) the Plaintiff 1st affidavit, an invoice dated 26 July 1996, showed documentary evidence of the Plaintiff is the 1st User of the Plaintiff’s Trade Mark in Malaysia; (2) OBI had the dishonest intention to deceive the Registrar to believe that OBI was the Common Law proprietor of the Defendant’s registered trade mark under Section 25(1) TMA by “conveniently” leaving a blank in form TM5. OBI must have also had the knowledge that they were not the Common Law proprietor of the Defendant’s registered trade mark. The Court ruled that the Defendant’s registered trade mark was procured by fraud perpetrated by OBI on the Registrar.

For the second ground, whether the Defendant’s Registered Trade Mark is likely to deceive and/or confuse the public was discussed. The Defendant’s counsel has argued that the Plaintiff’s Trade Mark and Registered Trade Mark have no logo whereas the Defendant’s Registered Trade Mark is combination of words and logo. Furthermore, the Defendant’s Counsel also highlighted the visual differences between the marks. Nevertheless, the Plaintiff succeeded to prove the likelihood of deception and/or confusion with an invoice which mistakenly stated the Plaintiff’s product had been purchased by the hired private investigator (PI) when the PI had in fact bought the Defendant’s goods. The Court also took into account that both the Plaintiff’s and the Defendant’s goods are in the same class 09. Despite the visual differences between the marks as argued by the Defendant, the Court highlighted the striking similarity, namely the alphabets “G” and “S” were featured most prominently in the Defendant’s Registered Trade Mark. Therefore, when the Plaintiff’s Trade Mark, Plaintiff’s Registered Trade Mark and the Defendant’s Registered Trade Mark are pronounced, there likelihood of deception and/or confusion was clear. The Court applied the “general recollection test” in which reasonable Customers and Traders with an average memory and an imperfect recollection would remember the Defendant’s Registered Trade Mark as the Plaintiff’s Trade Mark and/or Plaintiff’s Registered Trade Mark. Therefore, in view of the above evidence and reasons, the Court decided that the Defendant’s Registered Trade Mark has indeed offended Section 14(1)(a) of the TMA.
For the third ground, the Defendant resisted the expungement of their registered trade mark under Section 37(c) of the TMA by arguing that;
1. The word “GISI” is an invented and is not an English word, hence the registered trade mark is distinctive.
2. Defendant’s Registered Trade Mark is a combination of the words “GISI”, “Premium”, and “High Power” with a logo, thus such a combination is unique and distinctive.
3. “GISI Premium” was invented and does not exist in the English language. Furthermore, the words do not describe the quality and character of the goods in trade.

However, the Defendant failed to adduce documentary evidence of the use of their trade mark in the course of trade in Malaysia to distinguish their trade goods from other goods. In addition to acquiring the registered trade mark by way of assignment, the Court therefore, ruled against the Defendant’s arguments.

For the third issue, the Court has taken the decision of the Indonesian Supreme Court into consideration in which the Defendant’s registered trade mark on the Defendant’s goods is likely to deceive and/or confuse the public under Section 14(1)(a) read with Section 37(b) of the TMA. The Court’s decision was parallel with the Indonesian Supreme Court’s decision.

As for the fourth issue, it was discussed if the Court should draw an adverse inference against the Plaintiff for refusing the pricing of their good. The Court ruled in the favour of the Plaintiff by deciding that such information was not relevant to the issues which were brought forward in this OS. In the fifth issue, the defendant had referred to Section 40(1)(f) of the TMA as a ground to oppose to this OS. However, the Court has decided not to approve this submission as paragraphs (a) to (f) in Section 40(1) of the TMA only provide defences for an action for an infringement of a registered trade mark. The matter discussed herein this OS is not a trade mark infringement suit.

The Court had ruled for the OS to be allowed and ordered the Defendant’s registered trade mark to be expunged from the Register accompanied by the publication of expungement in the Gazette. The court also ruled for a cost of RM25000.00 paid by the Defendant to the Plaintiff.