MALAYSIA: THE 2-IN-1 TRIAL

July 25th, 2017

 

In the case of Doretti Resources Sdn Bhd v Fitters Marketing Sdn Bhd & Ors, the Plaintiff claimed that the Defendants had infringed the Plaintiff’s mark “PYRO” in their 1st suit and a counterclaim from the 1st suit was filed by “Fitters Marketing and Pyro-tech to remove the Plaintiff’s mark from the Register. The 3rd, 4th and 5th Defendants had requested the court to strike out the 1st suit and the Court had granted the strike out. A 2nd suit was filed by Fitters Diversified against Doretti Resources Sdn Bhd. In this case, both parties had agreed for both suits to be tried together.

Whilst both parties were preparing their written submissions, the Court of Appeal had reversed the 1st and 2nd Striking Out decisions. Therefore the decision of the 1st trial was postponed until the conclusion of the trial of the 1st suit against Teamware, Muetech and Viton (2nd trial). The Court had decided to provide one decision for 1st and 2nd suits.

There were several questions raised in the suits. Firstly, who was the first user of the trademark “PYRO” and what makes up the “use” of a mark in accordance to the Trade Mark Act under section 3(2)(a) and (b)? Secondly, is the use of the registered Mark on the Doretti’s goods likely to deceive and/or confuse the public as the goods may origin from Fitters Marketing or is associated with goods bearing the mark “PYRO” sold by Fitters marketing? Thirdly, is the registered mark on 14 August 2015, date of filing of counterclaim in the 1st suit by Fitters Marketing and Pyro-Tech (Counterclaim – 1st Suit) was distinctive of Doretti’s Goods?

Generally, the 1st user of a mark is the proprietor and therefore entitled to apply for a trademark registration under the Trade Mark Act. By right, Doretti was the proprietor of the mark unless the following circumstances could be proven: (i) the mark was registered by fraud, (ii) the registered mark offended Section 14 of the Trade Mark Act i.e. the mark is a common word, descriptive or may cause confusion for the consumers and etcetera, (iii) the registered mark was not, at the commencement of the Counterclaim in the 1st suit, distinctive of Doretti’s goods. In this manner, Fitters Marketing was able to provide the evidential burden to prove that they were the 1st User of the registered mark, PYRO. The decision was based on the invoice dated 5 June 2002 and DO dated 6 June 2002 which clearly showed that Fitters Marketing had used the mark 2 years earlier that Doretti’s registered date of the mark PYRO on 25 November 2004 and therefore, Fitters Market is the common law proprietor.

Dorreti’s goods were more likely to deceive and/or confuse the end-users as the public may assume that their goods derived from Fitters Marketing and/or even associated with Fitters’ goods bearing the mark, PYRO. Both parties had provided similar description, characteristics, composition, purpose and use of the goods bearing the mark PYRO, that fall within the same class 06.

In order to challenge the validity of the registered mark, PYRO, under Section 37(c) of the Trade Mark Act, Fitters Marketing had to discharge the legal burden to prove that the registered mark was not distinctive of Doretti’s goods on the date of filing of the Counterclaim of the 1st Suit. Based on Lim Yew Sing, at p.19, Mahadev Shankar JCA, a mark’s distinctiveness is described as “…to be gauged by the extent to which the trade mark is adapted to distinguish the goods with which its proprietor is connected in the course of trade goods with which no connection subsists. For the purpose of establishing distinctiveness, therefore, one must look to the use of the mark in the course of trade”. Therefore, in this case, there was sufficient documentary evidence given by Fitters Marketing and their testimony to prove that PYRO is indeed distinctive of Fitters’ goods. In addition to that, there were no other customers from Doretti who could vouch that the Registered Mark is distinctive of Doretti’s goods other their existing customers Fitters Marketing and Pyro-Tech. The Courts had decided that the Registered Mark was not inherently distinctive because other traders are likely in the usual course of their business and do not have any improper motive to utilize the PYRO mark. The Registered Mark was also not distinctive based on the fact that the goods from Doretti could be distinguished from Fitters’.

As a conclusion, Doretti’s claim in the 1st suit was dimissed, Doretti must pay the costs of Inquiry to Fitters Marketing, Pyro-Tech and Teamware, an interest at the rate of 5% per annum shall be imposed on the sum of compensatory damages assessed by the Registrar at the Inquiry and shall be paid by Doretti to Fitters Marketing, Pyro-Tech and Teamware. The Counterclaim in the 1st Suit was allowed and that Fitters Marketing should be declared as the 1st User and the Common Law proprietor of PYRO mark. The Registered Mark would be expunged from the Register and the removal must be published in the Gazette. The 2nd suit however was dismissed with the costs to be paid by Fitters Diversified to Doretti.