SINGAPORE – FAUX CALVIN

October 24th, 2016

 

In the case of Calvin Klein, Inc and another v HS International Pte Ltd and others [2016] SGHC 214, leading fashion designer Calvin Klein had sued Singapore-registered Global PSM for trademark infringement after investigators bought fake Calvin Klein goods including wallets and underwear online on the SGbuy4u website. In the end, the operator of local website SGbuy4u was ordered by the High Court to stop selling fake Calvin Klein goods, in the first reported case involving a summary judgment against a firm peddling fake goods online. A summary judgment means the case need not go to a full trial to hear witnesses and consider all the evidence because a prima facie case had been made out. A detailed summary of the case if as follows.

Calvin Klein, Inc (“the First Plaintiff”) is an internationally famous leading fashion design and marketing company. Calvin Klein Trademark Trust (“the Second Plaintiff”) is a business trust organised under the laws of the State of Delaware. The Second Plaintiff is the registered proprietor in Singapore of many registered Calvin Klein trade marks. The Second Plaintiff has appointed the First Plaintiff as its agent to take any and all action as may be deemed necessary to enforce the legal title in the trade marks owned by the Second Plaintiff.

HS International Pte Ltd (“the First Defendant”) is a Singapore-incorporated company located in Singapore, dealing with business-to-business logistic services for various types of business entities. Global PSM Pte Ltd (“the Second Defendant”) is also a Singapore-incorporated company and was registered by the Third Defendant, who is the sole shareholder and director of both the First and Second Defendants. The SGbuy4u Website was registered by the Third Defendant.

The website is a platform on which users can search for and buy goods ranging from apparel to health products and electronics. When a user pays for an item on the website, the business operator places an order on the Chinese shopping website Taobao, pays for the item, receives delivery in China and freights the item to Singapore to the customer. On the Taobao Website, individual Chinese sellers post listings or product advertisements consisting of photographs and written descriptions of the goods they wish to sell. The SGbuy4u Website is described as a “mirror website” of the Taobao Website as the listings found on the SGbuy4u Website are also listings found on the Taobao Website.

After two sample purchases, Calvin Klein sued and sought summary judgment against Global PSM, freight forwarding company HS International and Mr Jeffrey Tan, owner of the two firms. The Plaintiffs argued that both the First and Second Defendants worked side by sidein operating the SGbuy4u Website. They also had a sole and common director and shareholder which was Third Defendant. The Plaintiffs claimed that the Third Defendant was the “sole operating mind” of both the First and Second Defendants. According to the Plaintiffs, the goods did not originate from the Plaintiffs and were generally of poor quality. From the sample purchases, the Plaintiffs submit that the words “Calvin Klein” on the front cover of a wallet obtained from the First Sample Purchase lack clarity and the material used to construct the wallet has a rough texture and does not feel like genuine leather.

There were two main arguments to the defence. Under the first defence, the Defendants argued that any liability for trade mark infringement should ensue to the individual sellers on the Taobao Website and not themselves. Under the second argument, the Defendants denied that the First or Third Defendants are involved in the SGbuy4u Business or the website.

The Plaintiffs applied for summary judgment according to Order 14 of the Rules of Court on the basis that the Defendants have no defence to the claim for trade mark infringement. Under Order 14 Rule 3(1) of the Rules of Court, the Court may grant summary judgment if there is no issue or question in dispute which ought to be tried and there is no other reason why there ought to be a trial. It is well-established that the burden lies on the plaintiff to show that he has a prima facie case for summary judgment, and that once he has succeeded in doing so the defendant must, in order to obtain leave to defend, establish that there is a fair or reasonable probability that he has a real or bona fide defence. This is also as per the case of Ritzland Investment Pte Ltd v Grace Management & Consultancy Services Pte Ltd [2014] 2 SLR 1342.

The acts amounting to trade mark infringement in the Singapore Trade Marks Act is under Section 27(1), where it stated that “a person infringes a registered trade mark if, without the consent of the proprietor of the trade mark, he uses in the course of trade a sign which is identical with the trade mark in relation to goods or services which are identical with those for which it is registered”. From the parties’ submissions and affidavits, it is obvious that there is no disagreement between the parties that if the CK Marks were used, such use was in the course of trade and without the consent of the Plaintiffs.

The Defendants have not made any attempt in their oral or written submissions to dispute the presence of double identity. The Plaintiffs have established a prima facie case on the issue of double identity and that the Defendants have not shown that there is a fair or reasonable probability that they have a real or bona fide defence in this regard. Next, the Plaintiffs have shown a prima facie case that goods have been offered for sale under the sign “Calvin Klein” on the SGbuy4u Website.
The Defendants have denied selling the goods. The Defendants have continually proclaimed that the Second Defendant merely offers a courier or freight forwarding service. This argument was rejected. Although the product listings on the SGbuy4u Website mirror those on the Taobao Website, this does not automatically mean that the users of the SGbuy4u Website are transacting with the Taobao sellers when they select and pay for goods on the SGbuy4u Website.

From the weighing in on evidence, the Plaintiffs have shown a prima facie case that the goods were offered for sale under Section 27(4)(b) of the Trade Marks Act by the SGbuy4u Business on the SGbuy4u Website and that the Defendants have failed to show a fair or reasonable probability that there is any real or bona fide defence in this regard.

In the end, the court granted a summary judgment in respect of the Plaintiffs’ claim for trade mark infringement against the Second Defendant, but not against the First and Third Defendants.