Reebok International Ltd v Royal Corp

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JC
• Judgment Date: 11 November 1988
• Neutral Citation: [1988] SGHC 86
• Docket Number: Suit No 1685 of 1988
• Date: 11 November 1988
• Year: 1988
• Published date: 19 September 2003
• Plaintiff Counsel: David Young QC, Koh Kok Wah and Pamela Chong (Arthur Loke & Partners)
• Citation: [1988] SGHC 86
• Defendant Counsel: Roy Sharma and NS Kang (NS Kang)
• Court: High Court (Singapore)
• Subject Matter: Res Judicata,No offence disclosed in criminal proceedings regarding alleged import of counterfeit goods,Whether civil action an abuse of process of court,Proprietor of trade mark commencing civil action subsequently to protect trade mark,Whether res judicata and issue estoppel applicable,Issue estoppel

In July 1988, various complaints were made to the magistrate by members of a firm of private investigators alleging that Rising Sports Pte Ltd (Rising Sports) of No 1, North Bridge Road, 17-08, High Street Centre, Singapore 0617 had imported six containers of counterfeit Reebok shoes for sale in Singapore, thereby committing an offence under s 73 of the Trade Marks Act (Cap 332) (the Act). As a result, six search warrants were issued in respect of the six containers and two search warrant were issued against the premises of Rising Sport. In laying the complaints under the Criminal P rocedure Code, the firm of private investigators acted on behalf of Reebok International Ltd, the plaintiff in the present action.

By Criminal Motion No 24 of 1988 (CM 24/88) Rising Sports and Royal Corporation (a Japanese corporation having its place of business in Nagoya, Japan and the defendant in the present action) applied to the High Court that the record of the subordinate courts relating to the above search warrants be removed to the High Court and that the High Court do give to the subordinate courts the following directions:

(i) the complaints based on which the said search warrants were issued be at once dismissed as disclosing no offence under s 73 of the Trade Marks Act (Cap 332);

(ii) the said search warrants be quashed;

(iii) the `Reebok` shoes or products and documents seized thereunder be released to their rightful owners, the applicants respectively; and

(iv) such other directions as justice may require.

At the hearing of CM 24/88 on 15 and 22 August 1988, there was incontrovertible evidence that Rising Sports did not import the six containers of `Reebok` shoes and that the shoes belong to Royal Corporation, the defendant herein. In an affidavit filed therein on behalf of Rising Sports and Royal Corporation it was, inter alia, stated that:

12 The above document shows no doubt that (Rising Sports) was merely a notifying party and were not themselves the importers. It also shows that at no time did (Rising Sports) have possession of nor control over the goods. As such, (Rising Sports) have not committed any offence whether punishable under s 73 of the Trade Marks Act or at all. The allegations raised in the complaints of the various complainants are therefore false.

13 It is clear from the above that the complainants who purport to be from a firm of professional investigators had not conducted proper and thorough investigations before lodging a complaint before the learned magistrate where they accused (Rising Sports) of having committed a criminal offence in telling half-truths and outright falsehoods. They have misrepresented to the learned magistrate who in good faith relied upon the information provided and issued the warrants.

The president of Royal Corporation, one Iwao Nakane, has affirmed in a statutory declaration that the `Reebok` shoes belong to him. He explained in this way why the shoes have come to Singapore. Around April/May 1988, Royal Corporation was over-stocked with shoes. Storage space was expensive in Japan. From their inquiries it was much cheaper to ship the goods from Nagoya to Singapore and then back to Nagoya and to take advantage of the 28 days free storage offered by PSA for transhipment goods. Accordingly, Royal Corporation instructed its carrier `K-Line` to ship the six containers of shoes to Singapore and after to ship them back to Japan. These assertions were not disputed at the hearing of the criminal motion at which the Public Prosecutor authorized the counsel for the plaintiff herein to act and argue for the respondent in that motion.

From the written submission of the respondent in CM 24/88 it is clear that there was only one main issue before the court and I would quote from it: `The sole issue before this honourable court is whether there has been any impropriety in obtaining the search warrants, the subject of motion, and if so, whether such impropriety or irregularity has resulted in a failure of justice to nullify the seizure of the offending goods.` However in the course the hearing, extensive arguments were also made by counsel for the Public Prosecutor on the interpretation of s 73, particularly the word `imports`. At the conclusion of the hearing the High Court ordered that:

(1) the complaints based on which the said search warrants were issued be at once dismissed as disclosing no offence under s 73 of the Trade Marks Act (Cap 332);

(2) that the search warrants be quashed;

(3) that the documents seized from the office of the first applicant to be released and returned to the first applicant;

(4) the six containers and their contents to be released to the carriers `K-Line` and they are to be shipped back to Japan on the first available ship.

Application for a stay of execution was also refused.

On 23 August 1988, following the quashing of the search warrants, Reebok International Ltd, the plaintiff herein, instituted the present suit against Royal Corporation for infringement of the plaintiffs trade mark `Reebok` bearing registration no 326/84 in class 25 in respect of articles of sports clothing and footwear. Under `particulars` in the statement of claim filed herein, the same six containers of shoes are referred to. On an ex parte summons-in-chambers filed on the same day, an interim injunction was granted in favour of the plaintiff. On 1 September 1988, the defendant applied by summons-in-chambers to have the interim injunction dissolved and for damages to be assessed.

The application to dissolve the interim injunction is now before me. Counsel for the defendant raised a preliminary point of law for the determination of this court. It is the plea of res judicata or issue estoppel or abuse of the process of the court.

In the amended defence fled to this suit, the defendant avers:

6 Further or in the alternative on the ground of res judicata and or issue of estoppel the issues in this action have been determined and adjudicated upon in Criminal Motion No 24 of 1988 in the High Court of the Republic of Singapore and therefore the same is frivolous and vexatious and an abuse of the process of the court.

In the reply to this specific point, the plaintiff pleads:

4 The plaintiff refers to para 6 of the amended defence and say that

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