This article is based on the decision of High Court of Malaya in Kuala Lumpur, which has considered the scope and application of Sections 45 and 46 of the Trade Marks Act 1976 (hereinafter be referred as “the Act”) .
Oishi Group Public Company Limited (hereinafter be referred “the Plaintiff”) is a public company incorporated in Thailand and is in the business of manufacturing and producing beverages under its trade mark “OISHI”.
Liwayway Marketing Corporation (hereinafter be referred “the Defendant’) is a company limited by shares incorporated in the Philippines and is the registered owner of the trade mark “Oishi” in Class 30 and Class 43 on the Register of Trade Marks.
In 2011, the Plaintiff applied to register its trade mark “OISHI” in Class 32 but the application was rejected due to the Defendant’s trade mark “Oishi” in Class 30 and Class 43 on the Register of Trade Marks.
The Plaintiff had then sought to expunge the Defendant’s trade mark in Class 30 and Class 43 pursuant to Section 45(1)(a) and Section 46(1) of the Act. The Court considered three issues in this case:
- whether the Plaintiff is an aggrieved party within the meaning of Section 45 and Section 46(1) of the Act;
- whether the Defendant’s trade marks should be expunged for non-use; and
- whether the Defendant’s trade marks are entries made in the Register without sufficient cause and are therefore wrongfully remaining in the Register.
The Defendant submitted that the Plaintiff is not an aggrieved party within the meaning of Sections 45 and 46 of the Act as the Plaintiff is merely making an application for registration relying on the decision of the Federal Court in McLaren International Ltd v Lim Yat Meen [2009] 4 CLJ 749. The Court concluded that the Plaintiff is “an aggrieved person” as the Plaintiff and the Defendant are dealing in the same trade and the registrations of the Defendant’s marks would prejudice the Plaintiff’s legitimate business expectations and the Plaintiff would continuously suffer prejudice in their legitimate expectation to import, manufacture and sell its goods if the Defendant’s marks remain on the register. The Court’s conclusion is also based on the reasoning that the registered marks would provide the Defendant monopoly over a well-known, non-invented dictionary word which is in direct reference to the Defendant’s goods and services. The judgement cited the Federal Court case of LB (Lian Bee) Confectionary Sdn Bhd v QAF Ltd [2012] 3 CLJ 661 where it was held that “an aggrieved person” may have no rights at all but merely a genuine intention to use a trade mark that is registered but which has not been used by the registered proprietor.
Under Section 46(1)(b) of the Act, there must be a continuous period of non-use for three years up to one month before the filing of the application to expunge. The onus of proof will be on the plaintiff who must establish a prima facie evidence of non-use. Once the prima facie evidence of non-use is established, the onus will then be on the defendant to prove that there has been use of the trade marks during the relevant time period. The Court held that the Plaintiff has established the prima facie evidence of non-use based on the independent inquiry and market survey conducted by DNA Risk Sdn. Bhd., a company commissioned by the Plaintiff to conduct market survey in Klang Valley, Johor and Penang. The survey report shows that people are not aware of the “Oishi” products in the Malaysian markets.
The Court has rejected the cash invoices adduced by the Defendant to prove that there was use of the trade marks. The invoices were either rejected because they were issued before the relevant time period or by a third party, not the Defendant. It was noted that invoices bearing the word “Oishi” are no evidence that the goods actually bear the “Oishi” mark. Furthermore, the Court stated that Section 46(1)(b) must be read with Section 3(2) whereby the reference to use must be physical use of the mark on or in relation to the goods by the registered proprietor or registered user. Therefore, by simply showing the mark noted on cash invoices of a third party, and not of the registered proprietor or registered user is not “use” of the registered mark within the meaning of Section 46(1)(b) read with Section 3.
Alternatively, the Defendant submitted that the non-use is due to the application for halal certification which should fall within the special circumstance provided for in Section 46(4). However, the Court rejected this submission as the facts did not satisfy the test for special circumstance illustrated by Ungoed Thomas J in BULOVA Trade Mark [1967] RPC 29 that the special circumstance; must be peculiar or abnormal and must be external in nature; and the non-use must be as a result of those circumstances. The Court stated that non-use due to halal certification is not from an abnormal external event but a commercial choice. As such, it was concluded that there was non-use of the trade marks by the Defendant for the relevant time period.
The Defendant submitted that the registration of its trade marks is conclusive since seven years has lapsed since the registration pursuant to Section 37 of the Act. The Plaintiff rely on Section 37(b) and Section 37(c) in that the Defendant’s trade mark offends Section 14(1)(a) as the said mark is contrary to law as the same is not registrable under Section 10(1)(c) because it is not an inventive word and offends Section 10(1)(d) as the mark has a direct reference to the quality of the goods and is also a surname of prominent Japanese. The Plaintiff also submits that the Defendant’s mark is not distinctive as its dictionary meaning is “good taste”. The Court accepted that “Oishi” is not an inventive word and is a word having direct reference to the character or quality of the goods or services of the Defendant’s trade marks. The Court concluded that the Defendant cannot rely on Section 37 of the Act.
The Plaintiff’s application was allowed.