Wing Joo Loong Ginseng Hong (Singapore) Co Pte Ltd v Qinghai Xinyuan Foreign Trade Co Ltd and Another

• Jurisdiction: Singapore
• Judge: Kan Ting Chiu J
• Judgment Date: 09 April 2008
• Neutral Citation: [2008] SGHC 51
• Docket Number: Originating Summons No 2038 of 2006
• Date: 09 April 2008
• Year: 2008
• Published date: 12 June 2008
• Plaintiff Counsel: Tan Tee Jim SC, Christopher de Souza and Alma Yong (Lee & Lee)
• Citation: [2008] SGHC 51
• Defendant Counsel: Lau Kok Keng, Charissa Soh and Wendy Lin (Rajah & Tann),M Ravindran and Vicki Heng (Ravindran Associates)
• Court: High Court (Singapore)
• Subject Matter: Revocation,Whether mark was capable of distinguishing,Trade Marks and Trade Names,Whether registration should be invalidated,Alleged infringer's declaration granted in part,Invalidity,Relevant circumstances to be taken into consideration in exercise of power to revoke or invalidate,Whether court having discretion not to revoke or invalidate mark if grounds under ss 22(1) or 23(1) Trade Marks Act (Cap 332, 2005 Rev Ed) have been made out,Whether proprietor obtaining registration of mark through fraud and/or misrepresentation,Whether mark becoming common name in trade for which it was registered due to acts or inactivity of proprietor,Third party never claiming to be owner of copyright,Copyright,Whether proprietor having copyright,Whether application for registration made in bad faith,Failure of proprietor to prove claim,Whether there was non-use or suspension of use of mark for period of five years,Whether mark was customary to cordyceps,Onus of proof on proprietor

9 April 2008 Judgment reserved.

Kan Ting Chiu J:

The trade mark

1 The plaintiff’s principal application in these proceedings is to have a trade mark removed from the trade mark register. The mark, which is depicted below

[LawNet Admin Note: Click on the link to the PDF above to see the image]

is described as “rooster flower”, and consists of a picture of a rooster within a stylised flower border, the words “Rooster Brand” in English, and the Chinese words 雄鸡 meaning rooster. The registration extended over “traditional Chinese herbs, namely, cordy ceps, boxthorn fruit”.

2 The trade mark was registered in Singapore with effect from 6 September 1995 by a certificate issued on 27 August 2001. The first registered owner of the trade mark was Qinghai Medicines & Health Products Import & Export Corp of Qinghai, China (“Qinghai Meheco”). Ownership of the mark was assigned to the first defendant, Qinghai Xinyuan Foreign Trade Co, another Chinese corporation, on 30 May 2003, and the assignment is recorded in the register.

3 In these proceedings, the parties refer to the trade mark as a Rooster trade mark (without the flower border) and to cordyceps (spelt as one word), without boxthorn fruit, and I shall do likewise.

4 There is also an application for a declaration that the copyright in the Rooster mark and related labels bearing the mark do not belong to the defendants.

Background

5 The Rooster trade mark has been used for cordyceps in China since the 1950s, before there was a system for the registration of trade marks. When trade mark registration began in China in 1983, China Cereals Qinghai Branch had the rooster mark registered in its favour for cordyceps in 1985. In 1989, the rights to the mark were assigned to Qinghai Meheco, and the assignment was approved and recorded in the Trade Marks Office of the People’s Republic of China in 1995. In 1995, Qinghai Meheco applied to register the Rooster trade mark in the Registry of Trade Marks, Singapore, and the certificate was issued in 2001, backdated to take effect from 1995.

6 The trade mark went through two assignments. The trade mark was assigned to the first defendant and another entity, Qinghai Yixin Medical Co (“Qinghai Yixin”). Subsequently, Qinghai Yixin assigned its rights to the trade mark to the first defendant, with the result that the first defendant became the sole owner of the trade mark.

7 The first defendant applied to the Registry of Trade Marks, Singapore to transfer the Singapore trade mark to its name, and the transfer was recorded in 2006, backdated to 2003. In 2005, the first defendant granted an exclusive licence to Yu Ceng Trading Pte Ltd (“Yu Ceng”) to use the Singapore trade mark. In 2005, Yu Ceng applied for and obtained search warrants pursuant to which the plaintiff’s premises were raided, and quantities of cordyceps with alleged counterfeit Rooster trade marks were seized. In 2006, Yu Ceng’s licence was novated in favour of the second defendant, YCT Import & Export Pte Ltd.

The present proceedings

8 In the present proceedings, the plaintiff seeks remedies under two distinct areas of law, namely trade mark law and copyright law, for:

1. an Order that Trade Mark Registration No. T9508502Z in respect of the mark attached herewith be revoked pursuant to section 22(1) of the Trade Marks Act (Cap. 332) (“the Act”) as from 15 November 2005 or such other date as this Honourable Court may deem fit;

2. further or alternatively, an Order that Trade Mark Registration No. T9508502Z in respect of the mark attached herewith be declared invalid pursuant to section 23(1), (3)(b) and/or (4) of the Act;

3. a Declaration that any copyright in [the Rooster] labels attached herewith or in any literary or artistic work in each of the said labels does not subsist in favour of the Defendants or any of them and that the Plaintiff has not infringed the copyright (if any);

9 The Trade Marks Act (Cap 332, 2005 Rev Ed) will be referred to hereinafter as “the Act”, and all sections mentioned hereinafter are sections of the Act unless otherwise stated.

10 The plaintiff has also filed proceedings to set aside the search warrants. These applications have not been heard as they may be affected by the outcome of the present proceedings.

Prayers 1 and 2 – Trade Mark

The application for revocation

11 In its opening statement, the plaintiff submitted that:

6. Section 22(1)(c) of the Act provides that

The registration of a trade mark may be revoked on any of the following grounds:

…

(c) that, in consequence of the acts or inactivity of the proprietor, it has become the common name in the trade for the product or service for which it is registered.

7. This gives rise to two issues in the present context:

(1) Has the Rooster mark become, by 1 November 2006 (the date of this application), the common name in the trade for cordyceps for which it is registered?

(2) If so, was this due to acts or inactivity of the Defendants?

[emphasis added]

12 The plaintiff asserted that the Rooster trade mark has been used in relation to cordyceps from China from the 1950s at the latest.[note: 1] Originally, there was only one supplier of cordyceps, a state-owned company named China National Native Produce and Animal By-Products Import & Export Corporation (“China Tuhsu”). In the 1950s, China Tuhsu set up various provincial companies, and one of these companies, Guangdong Tuhsu, was authorised to export cordyceps. In the 1980s, other provincial companies including Sichuan Tuhsu and Qinghai Tuhsu were also allowed to export cordyceps, as were other state-owned companies such as the Foreign Trade Import & Export Corporation of Tibet Autonomous Region, China National Cereals, Oils and Foodstuffs Corp (“Cofco”) and China Medicines and Health Products Import & Export Corporation (“China Meheco”). China Meheco’s provincial companies, Sichuan Meheco, Chongqing Meheco, Qinghai Meheco and Guangdong Meheco, also enjoyed the same right. All these companies used the Rooster trade mark for their cordyceps and they competed amongst themselves.[note: 2] Cordyceps was also sold under other brands, but the Rooster brand was the best-established and the dominant brand in the market.

13 The plaintiff elaborated that:

12. All the companies used the Rooster mark and the Rooster labels for their cordyceps. This being the case, they competed with one another in other respects, such as price, quality of service and relationship. Each of the companies would claim that its cordyceps were of better quality than those from another company or another province, although in fact the quality would vary, depending on the year and quality of harvest. To distinguish the cordyceps of one company from those of others, the labels would indicate the particular provincial company which supplied the cordyceps concerned.[note: 3]

and added that it bought cordyceps from these companies.[note: 4]

14 The plaintiff went on to assert that:

26. [T]he Rooster mark and Rooster labels have been openly used in Singapore since at least the 1950s in relation to cordyceps from the various Chinese provincial companies. Both Qinghai Meheco and the 1^st Defendant … were at all material times well aware of the use. …

27. [T]he Rooster mark was, and still is, commonly associated by cordyceps traders and customers in Singapore as denoting cordyceps from China. In particular, they do not associate the Rooster mark with any particular trader or source. They do not consider it to be a mark which distinguishes the cordyceps of one trader from those of another. Whenever they see the Rooster mark, mention it (verbally or otherwise) or hear it, they would intuitively have in mind cordyceps imported from China.

and reiterated in its closing submissions that:

After 6 September 1995 (date of the trade mark application in Singapore), the mark continued to cease fulfilling its function as a trade mark and continued to be the common name for cordyceps emanating from China.[note: 5] [Emphasis added]

15 Section 22(1)(c) must be applied with particular attention to the cause and time when the trade mark becomes a common name in the trade. The cause must be the action or inaction of the proprietor. The term “the proprietor” should not be read as limited to the proprietor at the time of the application to revoke; it should be construed to apply to the chain of proprietors of a trade mark after it is registered. However, for s 22(1)(c) to apply, the trade mark must have become the common name in the trade after it has been registered. Where the trade mark is, as alleged, already the common name in the trade before its registration, that cannot be the consequence of the action or inaction of the proprietor.

16 The first defendant became the proprietor of the trade mark in 2003. On the plaintiff’s case, the Rooster trade mark was the common name in the trade for cordyceps as early as the 1950s, and certainly by the 1980s, and it could not possibly have become the common name as a consequence of acts or inactivity of the first defendant or its predecessors in title.

Section 22(1)(a) and (b)

17 The plaintiff also referred to s 22(1)(a) and (b) of the Act which provide that a trade mark may be revoked on the grounds:

(a) that, within the period of 5 years following the date of completion of the registration procedure, it has not been put to genuine use in the course of trade in Singapore, by the proprietor or with his consent, in relation to the goods or services for which it is registered, and there are no proper reasons for non-use;

(b) that such use has been suspended for an uninterrupted period of 5 years, and there are no proper reasons for non-use;

18 The plaintiff argued that the trade mark “must be used as a trade mark (that is, to indicate the origin or source of the goods or services in question)”[note: 6] and that

there was no such use in respect of the Rooster mark for the period of 5 years since the date of completion of the registration...