Singsung Pte Ltd v LG 26 Electronics Pte Ltd (trading as L S Electrical Trading)

• Jurisdiction: Singapore
• Judge: Sundaresh Menon CJ
• Judgment Date: 23 May 2016
• Neutral Citation: [2016] SGCA 33
• Plaintiff Counsel: Adrian Tan Gim Hai, Ong Pei Ching, Loh Jien Li, Joel Goh Chee Hsien (Morgan Lewis Stamford LLC)
• Docket Number: Civil Appeal No 135 of 2015
• Date: 23 May 2016
• Hearing Date: 24 February 2016
• Subject Matter: Passing Off,Groundless Threats of Legal Proceedings,Copyright Infringement,Intellectual Property
• Year: 2016
• Citation: [2016] SGCA 33
• Defendant Counsel: Philip Ling Daw Hoang and Kam Kai Qi (Wong Tan & Molly Lim LLC)
• Court: Court of Appeal (Singapore)
• Published date: 14 January 2017

Sundaresh Menon CJ (delivering the judgment of the court): Introduction

This appeal arises out of proceedings commenced by the appellant, Singsung Pte Ltd, and See Lam Huat (“Johnny”), against the respondent, LG 26 Electronics Pte Ltd (Trading as LS Electrical Trading), and See Lam Seng (“Seng”) on the grounds of passing off, copyright infringement and defamation. The respondent and Seng brought a counterclaim in malicious falsehood and for groundless threats of copyright infringement. For the reasons set out in Singsung Pte Ltd and another v LG 26 Electronics Pte Ltd (trading as LS Electric Trading) and another [2015] SGHC 148 (“the Judgment”), the High Court judge (“the Judge”) dismissed the passing off and copyright infringement claims and the counterclaim in malicious falsehood, but allowed the claim in defamation and the counterclaim for groundless threats of copyright infringement. This appeal does not concern the individuals, Johnny and Seng, or the claims in defamation and malicious falsehood. It is the appellant alone that appeals against the Judge’s decision to: dismiss its claim in passing-off; dismiss its claim for copyright infringement in respect of three works; and allow the respondent’s counterclaim for groundless threats of copyright proceedings in respect of the same three works.

The present appeal raises interesting legal questions which have not hitherto been fully canvassed in Singapore. These questions relate to how a plaintiff may prove the elements of the tort of passing off, the operation of the doctrine of instruments of deception, and the scope of liability for issuing groundless threats under s 200 of the Copyright Act (Cap 63, 2006 Rev Ed) (“the Copyright Act”). Before we turn to these questions, we outline the facts.

Background facts

Johnny and Seng are brothers. Sometime in the early 2000s, Johnny and Seng became business partners, acquiring second-hand electronic goods for re-sale to customers overseas under a partnership trading by the name S H Econ Electrical Trading. Unfortunately, by 2005, the relationship between Johnny and Seng had broken down. On 12 April 2006, the appellant was incorporated in Singapore with Johnny as one of its directors and the majority shareholder. Johnny passed away on 19 July 2015 and his widow now runs the appellant.

The appellant’s business consists primarily of the export of new electrical appliances manufactured in China to African and Asian markets such as Nigeria, Tanzania, Cameroon, Sri Lanka, Indonesia, Malaysia, Pakistan and Cambodia. The bulk of the appellant’s sales are made to trade buyers who are not resident in Singapore and who purchase the appellant’s products for export to foreign countries. It appears that these non-resident trade buyers or middlemen would usually visit the appellant’s shop at 39 Upper Weld Road to select the products that they wished to purchase. Thereafter, the selected products would be shipped to the trade buyer’s home country for sale to end users. At trial, the evidence that was adduced of the appellant’s export sales consisted only of sales to consumers in Cameroon (at [9] of the Judgment). While a portion of the appellant’s products are sold to customers resident in Singapore, it is accepted that these sales account for a relatively small proportion of the appellant’s business.

Like the appellant, the respondent trades in electrical appliances. Seng first registered his business as a sole proprietorship in October 2007 and later incorporated the respondent in January 2011. The respondent’s place of business is located next to the appellant’s, at 36/37 Upper Weld Road. Seng is the manager, sole shareholder and director of the respondent. Initially, the respondent dealt only in second-hand electrical appliances. Subsequently, the respondent began to deal in new electrical appliances as well.

The respondent’s products bear striking visual similarities to the appellant’s products across a range of goods from DVD players to electric kettles. In some cases, the products are sourced from the same Chinese manufacturers. For most of the products which are the subject-matter of the proceedings before this court, the only discernible difference between the appellant’s and respondent’s goods is the logo that is affixed to them. The appellant’s products bear the “SINGSUNG” mark, while the respondent’s products bear the “LS” mark. Besides the similarities in the range and appearance of the products sold, the respondent also targeted the same export markets as the appellant, namely, trade buyers from Africa and Southeast Asia. The respondent’s position is that, save for the sale of a handful of units of DVD players and rice cookers, its products are sold only to foreign (primarily African) customers.

The Judge found that the respondent had made a conscious decision to compete with the appellant in the same market over the same range of products. Essentially, the respondent’s business model was to shadow the appellant’s business in terms of products, markets and packaging. This is the crux of the appellant’s complaint on appeal.

Summary of the appellant’s claims

The appellant’s main cause of action is in the tort of passing off. The allegation made is that the get-up of the respondent’s products is identical or confusingly similar to the get-up of the appellant’s products thus misleading consumers into believing that the respondent’s products originate from or are somehow associated with the appellant. There are broadly eight different types of household appliances marketed and sold by the appellant which form the subject-matter of this appeal (“the Singsung Products”). They are: DVD player model DV-339K-III (“DVD Player A”); DVD player models DH-I, DH-II and DH-III (collectively referred to as “DVD Player B”); television sets; rice cookers; electric kettles; electric floor fans; electric blenders; and gas stoves.

The appellant claims that it has goodwill in its business and that this is sufficiently associated with the get-up of the Singsung Products (“the Singsung Get-Up”). The details of the Singsung Get-Up, as pleaded by the appellant in its statement of claim, consist of the following individual get-ups: The packaging and design of DVD Player A, which is termed “the White Get-Up”. The White Get-Up includes the white carton box (in which DVD player A is packaged) with an image of a DVD player, guitar and sitting room; a start-up screen that appears on the television when DVD Player A is connected to the television and switched on (“the Singsung Start-Up Screen”); a warranty card (“the Singsung Warranty Card”); the front and back panels of DVD Player A; and the white sticker on the front panel with a description of DVD Player A’s functions. An image of the White Get-Up may be found at Annex A. The packaging and design of DVD Player B, which is termed “the Blue Get-Up”. The Blue Get-Up includes the blue carton box (in which DVD Player B is packaged) with an image of the DVD model; the Singsung Start-Up Screen; the Singsung Warranty Card; the front and back panels of DVD Player B; and a blue sticker on the front panel with a description of DVD Player B’s functions. An image of the Blue Get-Up may be found at Annex B. The design and placement of a sticker on the appellant’s television sets, which includes the words “Rotary Rotatory” (“the Logo”); a symbol that shows that the television set may be rotated 90 degrees; an indication that the television set is brand new with three years warranty; and an indication that the television is ultra-slim (“the TV Sticker”). An image of the TV Sticker may be found at Annex C. The floral pattern on the appellant’s rice cookers (“the Floral Pattern”). The shape and design of five of the appellant’s electric kettles, each with its own get-up (collectively, “the Singsung Kettles Get-Up”). The shape and design of three of the appellant’s electric blenders, each with its own get-up (collectively, “the Singsung Blenders Get-Up”). The design of the appellant’s electric floor fan, comprising a round plastic base in the shape of a steering wheel (“the Singsung Fan Get-Up”). The design of the appellant’s gas stove, comprising an embossed horseshoe shape and a gold coloured burner rimmed by a circular chrome pot support (“the Singsung Gas Stove Get-Up”).

The appellant widely advertised and promoted its products through a catalogue (“the Singsung Catalogue”). The Singsung Catalogue included the phrase “Rely on us, as among the FINEST, we offer the MOST affordable prices” as well as a Swahili translation of this (“the Swahili Phrase”).

The appellant claims that the respondent distributed, offered for sale, sold and dealt in very similar, if not, identical products and that these were packaged and presented in a way that was identical or confusingly similar to the Singsung Products. It is not disputed that save for the “SINGSUNG” and “LS” marks that were found on the goods of the respective parties, the respondent’s products had a get-up that was identical to the Singsung Get-Up for the corresponding product. The respondent also advertised its products with the same Swahili Phrase. The appellant argues that the respondent’s actions as a whole were calculated to deceive and/or mislead the trade and public and have in fact misled the trade and public into believing that the respondent’s products originate from or are somehow associated with the appellant. For ease of reference, we shall refer to the respondent’s products which are the subject-matter of the appellant’s complaint as “the LS Products”. We also refer to the respondent’s get-ups which are similar to the White Get-Up, Blue Get-Up and the TV Sticker as the “LS White Get-Up”, the “LS Blue Get-Up” and the “LS TV Sticker”, respectively. Images of these get-ups may be found at Annex A, B and C, respectively.

Apart from the tort of passing off, the...