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MALAYSIA: JAPANESE COMPANY DEFEATS MALAYSIAN COMPANY IN A TRADE MARK AND COPYRIGHT CASE

23rd January, 2019

In a High Court ruling, Hakubaku Co. Ltd. (hereinafter referred to as “the Plaintiff”), a Japanese company which manufactures, among others, noodles is allowed to file a trade mark expungement application under Section 45(1)(a) of the Trade Marks Act 1976 (hereinafter referred to as “the TMA”) to expunge a registered trade mark registered by a Malaysian company Asiamega Food Manufacturers Sdn. Bhd. (hereinafter referred to as “the Defendant”) for goods in Class 30 which are among others, noodles.

In this expungement application, the Plaintiff applies to the High Court to expunge a registered trade mark, Hakubaku & Device which is owned by the Defendant.

From the facts of the case, it is noted that the Defendant registered trade mark in Malaysia on 8 April 2015. The Plaintiff filed two trade mark applications for a similar mark Hakubaku & Device on 15 October 2015 for goods in Class 30 and 31 but the Examiner did not allow the Plaintiff’s Applications as they are similar to the Defendant’s registered trade mark.

Is there any ground that warrants an expungement application? Let’s examine this case.

If, it is assumed that the Defendant is the first user of the registered trade mark in Malaysia and is a common law proprietor, this confers exclusive right on the Defendant to use the registered trade mark and prima facie it is a valid trade mark. The Defendant argued that the Plaintiff did not object to the Defendant’s application when the application was published during the opposition period.

In response to this, the Court said that if an estoppel is issued by Court on basis of first to use, this may prevent any parties who have legitimate grounds from asserting their right or a claim. Therefore, it shall not serve as grounds for issuing an estoppel as delivered in the judgement of Yong Teng Hing B/S Hong Kong Trading Co & Anor v Walton Internation Ltd. and Ho Tack Sien & Ors v Rotta Research Laboratorium SpA & Anor, Registrar of Trade Marks (Intervener) & Another Appeal. The Court also held that while no objection was raised by Plaintiff during opposition period, this does not serve as ground for issuing an estoppel because trade mark applications may have been entered in error or error in the Register and/or the trade mark was registered without an intention in good faith.

Under Section 25(1) of the TMA, it is clear that the rule of ownership of a trade mark goes to the first-to-use, not the first-to-file basis. It must be noted that, a mere application to the Registrar does not constitute first-to-use. Accordingly, the onus lies in the Plaintiff to show the first-to-use in Malaysia. In this regard, the Plaintiff submitted two evidence of use: 1) an extract of a sales report of Plaintiff’s goods in a premium Japanese supermarket dated 6 June 2013 with signed affidavits from the manager and 2) an advertisement posted in a website which shows Plaintiff’s goods as one of the ingredients for a recipe dated 23 November 2011. It should be noted that, the Defendant has filed its first trade mark on 23 September 2013 i.e. more than 3 months after the first-to-use of Plaintiff’s goods.

In addition, the Plaintiff owns copyright of three Hakubaku marks which have sufficient objective similarity because both have the same device in the same red colour. In this case, the Defendant failed to submit evidence to prove that the Defendant has created the registered trade mark by itself. On the other hand, the Plaintiff exhibited true copies of the three Hakubaku marks and submitted signed Affidavits from the President of the company which produced the three Hakubaku marks.

The Court held that it has been established that the Plaintiff is the first user of Hakubaku & Device and accordingly, registered trade mark by the Defendant were ordered to be expunged from the Register. The Court also held that the Defendant has infringed the Plaintiff’s Copyright.