Case Note

• Citation: (2011) 23 SAcLJ 640
• Date: 01 December 2011
• Author: NG-LOY Wee Loon LLB (National University of Singapore), LLM (London); Advocate and Solicitor (Singapore); Professor, Faculty of Law, National University of Singapore.
• Published date: 01 December 2011

THE CONUNDRUM OF “TRADE MARK USE”

City Chain Stores (S) Pte Ltd v Louis Vuitton Malletier

[2010] 1 SLR 382

One of the thorny questions in infringement claims brought under the Trade Marks Act is the following: is there a requirement for “trade mark use” in the infringement provision? The difficulties in this area are evident from the fact that, although this question is supposed to have been answered by the European Court of Justice in 2002, two leading academics in the UK maintain that “some controversy and uncertainty” surrounds this question in the EU today. Uncertainty in trade mark law is bad news for the business community. For Singapore, the answer was previously found in the High Court‘s 2005 judgment in Nation Fittings (M) Sdn Bhd v Oystertec plc [2006] 1 SLR(R) 712. Now, in City Chain Stores (S) Pte Ltd v Louis Vuitton Malletier [2010] 1 SLR 382, the Court of Appeal has weighed in on this debate.

I. Introduction

1 In most trade mark infringement actions, the complaint of the plaintiff (the registered proprietor) is that the defendant has used a sign in a manner that suggests to the purchasing public that his goods or services are those of the plaintiff or that they originate from a source which is economically linked to the plaintiff. There are various shorter ways of describing this manner of using the sign: the defendant has used the sign in a trade mark sense, or used the sign as a trade mark, or engaged in trade mark use of the sign, that causes confusion in the marketplace. The core idea in all these different formulae is that the defendant has used the sign to denote the trade origins of the goods or services in question. In this case note, uses of a sign which embody this core idea shall be referred to as “origin-related use”.

2 What then are non-origin-related uses of a sign? These of course are uses of the sign that have purposes other than to denote the

trade origins of the goods or services. This may be obvious, but it is still useful to provide a few examples of non-origin-related uses of a sign. The classic example would be the use of a sign to describe the quality of the goods or services. Imagine that the registered trade mark is the word mark “CROCODILE” and the defendant‘s shoes, which are made of crocodile skin, are labelled “XYZ BRAND (crocodile skin)”. Here, the defendant is using the word “crocodile” in a descriptive sense. Another example is known as “use as a badge of allegiance”. Imagine that someone has registered a wedding photo of Prince William and Kate Middleton for cups and posters, and there is evidence that the purchasing public merely treat these items as carriers of the image of the royal couple. To put it in another way, the wedding photo appearing on the cup does not serve to inform the purchaser that the cup came from a particular trade source and, in this sense, the wedding photo is not used as a trade mark. The third example is where the sign is used on the goods for embellishment or decorative purposes. This was what happened in City Chain Stores (S) Pte Ltd v Louis Vuitton Malletier1 (“City Chain”).

3 The plaintiff in City Chain was the Louis Vuitton (“LV”) Company. The mark in question was the design of a flower known as the “Flower Quatrefoil” mark. This mark was registered for watches. The defendant, an established chain of watch shops, sold watches under the brand “SOLVIL”. The watch face of one particular line of the defendant‘s products featured a series of flowers which were similar to the Flower Quatrefoil mark. The flowers on the defendant‘s watch face were arranged in a randomly repeated and non-uniform pattern. This prompted the Court of Appeal to find that the predominant use of the SOLVIL flower on the defendant‘s watches was for decorative purposes. Such use, said the appellate court, was “not trade mark use”.2 This finding brought to the fore the legal issue: can a non-origin-related use amount to an infringing act within s 27, the infringement provision in the Trade Marks Act 1998?3

4 The Singapore ss 27(1)-27(2) are derived from the infringement provision in the EU Trade Marks Directive.4 The legal issue posed above is supposed to have been answered by the European Court of Justice (“ECJ”) in its 2002 decision in Arsenal Football Club plc v Reed5 (“Arsenal”). There, the ECJ held that there was infringement provided the defendant‘s use was “liable to affect the functions of the trade mark,

in particular its essential function of guaranteeing to consumers the origin of the goods” [emphasis added].6 The conventional interpretation of this test is that the infringement provision captures origin-related uses and non-origin-related uses. However, there was some resistance to this interpretation in certain quarters in the UK.7 For example, Lord Nicholls in R v Johnstone interpreted the Arsenal test to encompass only origin-related uses.8 Even today, two leading academics in the UK maintain that “some controversy and uncertainty surrounds the question whether, and if so which, [non-origin-related] uses should constitute infringement” in the EU.9 This sentiment is shared by many others in the EU, as noted in an eminent study of the European trade mark system published in February 2011.10 This study recorded that there was “general agreement among participants [in its survey] that the current jurisprudence of the ECJ in respect of those issues [in particular, the requirement that a mark must be used as a trade mark] is neither consistent nor satisfactory”.11

5 City Chain was not the first time this legal issue had arisen in Singapore. Earlier in Nation Fittings (M) Sdn Bhd v Oystertec plc12 (“Nation Fittings”), Andrew Phang J (as he then was) sitting in the High Court was confronted with this issue. The registered mark was a twodimensional plan drawing of a pipe fitting, and the defendant was sued for trade mark infringement for marketing pipe fittings of a shape which was similar to the registered mark. The mark was so integral to the product in question (pipe fittings) that the defendant was merely using the mark to tell the world what his product was, namely, pipe fittings. To put it in another way, the defendant was using the mark in a descriptive sense. Phang J found that the defendant had not used the mark “as a trade mark as such”.13 After considering the differing approaches in the UK, Phang J decided that without trade mark use there could be no infringement under s 27. He reasoned that this stricter

approach was consistent with “logic and fairness”14 because “trade marks have, in the final analysis, to do with the origin of the goods concerned”.15

6 When the question surfaced a second time in City Chain, Phang JA was one of the judges of appeal hearing the dispute, the other two being V K Rajah JA and Chao Hick Tin JA. The judgment was delivered by Chao JA. It was a unanimous decision. After an analysis of the Arsenal decision and how this decision had been interpreted by the ECJ and the UK courts in later cases, the Court of Appeal came to the conclusion that the EU indeed had a “broader Community approach”16 where the focus of the inquiry was not on whether the defendant‘s use was origin-related, but on whether the defendant‘s use was liable to affect the functions of the trade mark. The appellate court proceeded to weigh the advantages and disadvantages of this broader approach. The balance came down in favour of adopting a stricter approach, that is, to have a requirement for origin-related use in s 27. For convenience, the broader Community approach shall be referred to as the “European Approach”, and the stricter approach adopted by the Court of Appeal (and by the High Court in Nation Fittings) as the “Singapore Approach”. Before examining the policy reasons for discarding the European Approach, it is useful to have a better understanding of the implications of adopting the Singapore Approach.

II. Implications of adopting the Singapore Approach

7 Some may get the impression that adopting the Singapore Approach means that all origin-related uses are infringing acts in s 27. This is not true. Adopting the Singapore Approach means that non-origin-related uses cannot be...