Intellectual Property Law

AuthorTAN Tee Jim SC LLB (University of Singapore), LLM (University of London); Advocate and Solicitor (Singapore). NG-LOY Wee Loon LLB (Singapore), LLM (London); Advocate and Solicitor (Singapore); Associate Professor, Faculty of Law, National University of Singapore.
Published date01 December 2007
Date01 December 2007
Trade marks and passing off

17.1 There were three trade mark judgments delivered in 2007 (in chronological order):

(a) Future Enterprises Pte Ltd v McDonald”s Corp[2007] 2 SLR 845 (CA). These were trade mark opposition proceedings. The main focus of the dispute was on s 8 of the Trade Marks Act (Cap 332, 2005 Rev Ed) which sets out what are sometimes called ‘conflicts with earlier marks and rights’. This is where one party (the opponent) opposes the trade mark application filed by another party (the applicant) on the basis that registration of the trade mark in the name of the trade mark application would conflict with an earlier trade mark or right belonging to the opponent.

(b) Weir Warman Ltd v Research & Development Pty Ltd[2007] 2 SLR 1073 (HC). These were proceedings to expunge a trade mark from the register. The validity of the initial registration was challenged on the grounds that the registration was made in bad faith and/or was obtained by fraud or misrepresentation, and here, the focus of the dispute was on ss 7(6) and 23(4) of the Trade Marks Act. Alternatively, even if the initial registration was valid, it was alleged that the registration ought to be revoked on the grounds of ‘non-use’ of the trade mark set out in s 22(1) of the Trade Marks Act.

(c) Amanresorts Ltd v Novelty Pte Ltd[2007] SGHC 201. These were proceedings to stop the use of a trade mark by a party on the basis that such use constituted passing off at common law, and infringement of a statutory right conferred by s 55 of the Trade Marks Act on proprietors of well-known trade marks.

17.2 The issues explored in these trade mark cases varied. But there was one issue that appeared in all three cases, namely, the principle of

territoriality in trade mark law. This common issue will be explored first, before attention is turned to some of the other issues raised in the cases.

The principle of territoriality

17.3 At the international level, the territorial nature of trade mark rights is embodied in Art 6(4) of the Paris Convention for the Protection of Industrial Property 1967 (the international treaty on trade marks): ‘A mark duly registered in a country of the [Paris] Union shall be regarded as independent of marks registered in the other countries of the Union’. Registration of a trade mark in one country confers on its proprietor a certain monopoly in that country only. So, for example, the UK Trade Marks Act 1994 specifies in s 9 that the proprietor of a registered trade mark has exclusive rights in the trade mark which are infringed by use of the trade mark in the United Kingdom without his consent. (In the US, though, they have, in a rather controversial case, applied American trade mark law extra-territorially to deal with a US citizen for conducting infringing activities in Mexico: see Steele v Bulova Watch Co344 US 280 (1952).)

17.4 In Singapore, the territoriality principle is manifested within the Trade Marks Act (Cap 332, 2005 Rev Ed) in, for example, s 22 on revocation of registered trade marks which have not been used in Singapore for the relevant five-year period. Thus, the registration in Singapore cannot be saved by the fact that the registered proprietor has used the mark in other countries. Proof of user outside of Singapore is irrelevant for the purposes of revocation for non-use.

17.5 In the common law action for passing off — the branch of the law which could be said to protect the ‘common law rights’ of a trader to an unregistered trade mark — the territoriality principle manifests itself in the notion that goodwill, the first element in the action, is ‘local in nature and divisible’ (Star Industrial Co Ltd v Yap Kwee Kor[1975—1977] SLR 20 (‘Star Industrial’) at 31, a Privy Council decision on appeal from Singapore). Thus, if a trade mark proprietor conducts business in several countries, a separate goodwill attaches to his business in each of these countries. If the trade mark proprietor is suing for passing off in Singapore, he must prove that he has a business in Singapore to which goodwill attaches. Proof of his business conducted in other countries, and his user of the trade mark in these other countries, is irrelevant for the purposes of satisfying the first element in an action for passing off in Singapore. This requirement for goodwill to be hinged onto a business/user of the trade mark within jurisdiction has been described as the ‘hard line’ approach (see, eg, Mechanical Handling Engineering (S) Pte Ltd v Material Handling Engineering Pte Ltd[1993] 2 SLR 205 at 210). The Star Industrial case and the ‘hard line’ approach,

was endorsed by our Court of Appeal in 1998 in the Millenia case (CDL Hotels International Ltd v Pontiac Marina Pte Ltd[1998] 2 SLR 550 at [50]). While adopting the ‘hard line’ approach in this case, the Court of Appeal at the same time took a liberal interpretation as to how this approach may be satisfied. It held that it was not necessary for the trader to show that, as at the relevant date, he had commenced business in Singapore. Pre-trading activities — in the case, it was extensive pre-launch publicity — could also generate goodwill.

17.6 It is precisely because Singapore adopts the ‘hard line’ approach in the common law scenario that ss 55(1)—55(2) was added into the Trade Marks Act (Cap 332, 2005 Rev Ed) when it was first enacted. The original version of ss 55(1)—55(2) was amended in 2004. The current provisions read as follows:

  1. (1) A well known trade mark shall be entitled to protection under this section —

    1. (a) whether or not the trade mark has been registered in Singapore, or an application for the registration of the trade mark has been made to the Registrar; and

    2. (b) whether or not the proprietor of the trade mark carries on business, or has any goodwill, in Singapore.

  2. (2) Subject to subsections (6) and (7), the proprietor of a well known trade mark shall be entitled to restrain by injunction the use in Singapore, in the course of trade and without the proprietor”s consent, of any trade mark which, or an essential part of which, is identical with or similar to the proprietor”s trade mark, in relation to identical or similar goods or services, where the use is likely to cause confusion.

17.7 The substantive right in s 55(2) is, in many ways, similar to the protection available in the action for passing off. The significance of this right lies in the definition of the type of trade marks entitled to the protection that is found in s 55(1), in particular, the inclusion of proprietors of unregistered well known trade marks who do not carry on business or have any goodwill in Singapore. Traders in this position, whilst they do not have a remedy in the law of passing off, are compensated by having this statutory right in s 55(2). (Note that s 55(3) provides substantive rights of other nature. These will be discussed later.)

17.8 It is against this background that we assess what impact the three trade mark cases under review have on the issue of territoriality.

17.9 In Future Enterprises Pte Ltd v McDonald”s Corp, the fast food chain giant McDonald”s, relied on its earlier registered mark ‘McCafé’ for coffee and related products, to oppose the application filed by a local company (‘Future Enterprises’) to register the mark ‘MacCoffee’ in

respect of instant coffee mixes. McDonald”s argued that the two marks were similar, the parties” goods were similar if not identical, and there existed a likelihood of confusion amongst the public. Hence, registration of the ‘MacCoffee’ mark would contravene s 8(2)(b) of the Trade Marks Act. The High Court”s findings were in favour of McDonald”s, and Future Enterprises” trade mark application was rejected. The High Court”s decision (which was reviewed last year) was upheld by the Court of Appeal.

17.10 Before the appellate court, Future Enterprises then launched a novel argument: it had a ‘common law right’ to the ‘MacCoffee’ mark which restricted and rendered inoperative MacDonald”s right to oppose the registration of the ‘MacCoffee’ mark, even though it was confusingly similar to ‘McCafé’, an earlier registered trade mark. Before assessing the merits of this novel argument, the Court of Appeal had to decide a preliminary point, namely, whether Future Enterprises had in fact acquired a ‘common law right’ to the ‘MacCoffee’ mark.

17.11 Future Enterprises claimed that this ‘common law right’ had been acquired in two ways: first, by its use in Singapore and secondly, by its ‘international reputation’ stemming from its sales in Russia and other East European countries since 1995. On the first ground, the Court of Appeal reviewed the advertisements tendered by Future Enterprises as evidence to prove user of the ‘MacCoffee’ mark in Singapore, and noted that the advertisements related primarily to marketing efforts in Russia and other East European countries (and not in Singapore) and even these advertisements abroad highlighted a different mark, namely, a composite mark comprising the word ‘MacCoffee’ and a prominent eagle device. Future Enterprises was really selling its coffee products under this composite mark rather than the word mark ‘MacCoffee’. (Future Enterprises had previously been involved in litigation over the use of this composite mark: see Future Enterprises Pte Ltd v Tong Seng Produce Pte Ltd[1998] 1 SLR 1012; McDonald”s Corp v Future Enterprises Pte Ltd[2005] 1 SLR 177.) The Court of Appeal concluded that there was insufficient use of the ‘MacCoffee’ mark in Singapore so as to entitle Future Enterprises to protection on the basis of prior use.

17.12 It is the second argument made by Future Enterprises that is interesting. By relying on its ‘international reputation’ arising from its sales of ‘MacCoffee’ products in Russia, etc, as the basis for its ‘common law right’ to the mark in Singapore, it was in effect challenging the ‘hard line’ approach. This is what this argument...

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